Dismissal Issues
Cases
Western Excavating v Sharp
[1978] QB 761, [1978] ICR 221, [1977] EWCA Civ 2
Lord Denning MR
‘If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any further performance. If he does so then he terminates the contract by reason of the employer’s conduct. He is constructively dismissed. The employee is entitled in those circumstances to leave at the instant without giving any notice at all or, alternatively, he may give notice and say he is leaving at the end of the notice. But the conduct must in either case be sufficiently serious to entitle him to leave at once. Moreover, he must make up his mind soon after the conduct of which he complains: for, if he continues for any length of time without leaving, he will lose his right to treat himself as discharged. He will be regarded as having elected to affirm the contract.’
A resignation by an employee is a repudiation of the contract of employment, a fundamental breach.
Liz Allen v. Independent Newspapers (Ireland) Ltd
UD 641/2000
The issue for the Tribunal is whether Ms Allen was dismissed by construction under the definition of dismissal under section 1(b) of the Unfair Dismissal Act 1977 , which provides as follows:
… the termination by the employee of his contract of employment with his employer, whether prior notice of termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of termination to the employer.
Having regard to the aforementioned definition and to the evidence and submissions the Tribunal deems the proper test in this case is whether it was reasonable for Ms Allen to terminate her contract of employment.
Having given careful consideration to the evidence adduced and the submissions made on behalf of the parties and having regard to the various findings and conclusions arrived at by this Tribunal, as already outlined in this determination, it is the unanimous view of the Tribunal that it was reasonable in all the circumstances for the claimant to terminate her contract of employment.
Mr Connaughton BL, on behalf of the respondent, has submitted, inter alia , that it was incumbent on the claimant before resigning to utilise the NUJ grievance procedures. The objective of utilising the NUJ grievance procedure would have been to bring the claimant’s grievances to the attention of the respondent. The Tribunal is however satisfied that at various stages throughout her employment and more particularly in September 2000 Ms Allen brought her complaints to senior management level within the respondent newspaper. We also note Mr Moore’s evidence in cross-examination that an employee’s grievance could be processed by either going to the union or directly to management.
Mr Connaughton also submits that the claimant cannot rely on any matter prior to June 29, 2000 as grounds for resigning her employment on the basis that the claimant, in her own evidence, expressed herself happy with the outcome of June 29, 2000 meeting at which she had outlined her grievances.
The Tribunal rejects this argument and does so having regard to the various findings and conclusions arrived at by the Tribunal as set out in this determination. The Tribunal considers it reasonable for the claimant to have taken into consideration the manner in which her various complaints were dealt with from 1999 through to 2000 in arriving at her conclusion that she had essentially lost faith in what was being offered by way of investigation by the respondent in September 2000. She was entitled to do so because we accept that she had cause for complaint after June 2000. The Tribunal therefore finds the claimant’s conclusion that she could have no confidence in the respondent to either properly or effectively address her grievances was a reasonable conclusion in all the circumstances. Moreover, the claimant did not act unreasonably in taking into consideration the likely effect on her health and well-being were she to remain in the work environment. In assessing the reasonableness of her decision in this regard the Tribunal accepts that the effect on her health and well-being was a concern she had prior to her resignation, a concern that had been communicated to the respondent in September 1999.
Accordingly, the Tribunal unanimously finds the claimant to have been constructively dismissed and as no evidence has been offered to rebut the presumption of unfairness the Tribunal determines the claimant was unfairly dismissed for the purposes of the Unfair Dismissals Act 1977 to 1993. We do not find that the claimant contributed in any way to her dismissal.
B v F International Limited
(UD/70/2007)
“Respondent’s Case:
The claimant was dismissed due to her refusal to accept changes in her sales territory and the structure of sales commission. The claimant had been notified and consulted prior to the change, and although she wasn’t happy with the changes, the company considered that the changes should be made.
The respondent company is a furniture wholesaler, which supplies retailers throughout Ireland. The claimant commenced her employment as a field sales representative in December 2001. The position involved selling and providing customer service to retailers in a given territory. Sales representatives are expected to make monthly calls to customers in their territory to make sales, take back returns, increase the number of the company’s products on display and establish new accounts. The claimant’s contract of employment stipulated that the sales area she covered and the sales commission structure were subject to change to suit the needs of the business.
Determination:
The Tribunal does not refute the employer’s entitlement to re-structure nor is the employer obliged to consult with staff on the detail. However, the Applicant raised a very real fear that her income would drop. She indicated the reduction in her remuneration would arise with the loss of her three lucrative counties, together with the new commission structure.
The Applicant did not have a good working relationship with the Director of Operations. He did nothing to foster good relations and was utterly unprofessional in his dealings with her. As the
Applicant was on the road so much, her relationship with the said Director was not of great import.
However with the introduction of the new commission and sales areas it was essential that the Director of Operations be available to discuss these changes on a one to one basis and in a positive atmosphere.
Describing the Applicant as the “weakest link”, telling her she was “dishonest” and calling her in for spurious meetings did nothing to alleviate the Applicant’s concerns.
In the circumstances it was hardly surprising that the Applicant had to go on sick leave.
Crucially, the Applicant asked to invoke the grievance procedure to review the structural changes and to discuss a raise in salary where there might be a drop in commission. The company failed to follow its own grievance procedure. In its subsequent dealings with the Applicant the company failed to act reasonably.
It is only on the rarest of occasions that the Tribunal will come across a situation where an employer has so blatantly infringed the rights and integrity of an employee. The Tribunal finds this to be such an occasion.
The Applicant was forced into a situation wherein she had no alternative other than to hand in her resignation. The Respondent’s behaviour gave rise to this situation and a situation of
constructive dismissal arises. Accordingly the Tribunal awards the Appellant the sum of € 35,000 under the UnfairDismissals Acts, 1977 to 2001.
Employer v Employee
UD1967/2011
“Determination:
The claims under the Minimum Notice and Terms of Employment Acts, 1973 to 2005, and the Organisation of Working Time Act, 1997, were withdrawn at the outset of the hearing.
The claimant is alleging she was constructively dismissed from her employment with the respondent company. Section 1 of the Unfair Dismissal Act defines constructive dismissal as:
“…the termination by the employee of his contract of employment with his employer whether prior notice of the termination was or was not given to the employer in the circumstances in which, because of the conduct of the employer the employee was or would have been entitled or it was or would have been reasonable for the employee to terminate the contract of employment without giving prior notice of the termination to the employer” The burden of proof, which is a very high one, lies with the claimant. She must show that her resignation was not voluntary. The legal test to be applied is “an and or test”. Firstly, the Tribunal must look at the contract of employment and establish whether or not there has been a significant breach going to the root of the contract. If the Tribunal is not satisfied that there has been a significant breach of the contract it can examine the conduct of both the employee and employer together with all the circumstances surrounding the termination to establish whetheror not the decision of the employee to termination the contract was a reasonable one.
The claimant made her claim for constructive dismissal under the following heading:
Unilateral alteration of her contractual terms (cut of her working week from five days to three days.)
The claimant commenced work at the respondent crèche in 2006. She worked there without issue until June 2011. On the 9th June the Manager called a staff meeting to discuss the respondent’s financial situation together with normal business matters. The claimant stated that the Manager informed the staff that she intended to introduce a 10% pay cut. The claimant was given a letter of consent to sign. The respondent stated that she asked her staff to consider a 10% pay cut and that it was in no way being forced upon them. The letter dated, 7th June, 2011 states “We have decided that a salary reduction is absolutely necessary at this time. We regret to inform you your monthly basic salary will be reduced by 10% which will take effect and be deducted from your next pay date….” Based on the wording of that letter the Tribunal prefers the claimant’s evidence and find that the staff members were not given a choice at the meeting of the 9th June. The respondent also stated that the pay cut was only a temporary measure. The claimant stated that that was never put to her. The letter of the 7th June is silent on that matter. The Tribunal prefers the claimant’s evidence but find that nothing turns on the matter one way or the other.
The claimant refused to sign the letter of consent and informed the Manager that she would not be doing so on the 10th June, 2011. The following Monday the claimant’s shifts were changed for the first time in five years. On Friday the 17th June, the claimant was informed that she would not be required to work on Monday or Tuesday of the following week. That amounted to a 40% reduction in her wages. The claimant’s contract of employment states “Your normal working week will be 5 days, Monday to Friday”. For the previous five years that claimant had worked Monday to Friday. The claimant was concerned that she did not have those instructions from the manager in writing so she attended for work on Monday morning. When she arrived at her workplace she asked for meeting with the Manager so that she could have her instructions in writing. She asked why the Manager had altered the terms of her contract. She was told that it was because some of the children were on holidays. The claimant became very distressed due to the Manager’s treatment of her. When she left she went to her GP and following that meeting was certified unfit for work. The claimant furnished the respondent with sick certificates on a weekly basis until 28th September, 2011. She lodged her claim on the 6th October, 2011.
The legal test the claimant must satisfy is an onerous one. Firstly, the claimant must show that there has been a significant breach going to the root of the contract, which said breach prevented the claimant from carrying out her contractual duties. It is very clear from the evidence that the claimant was singled out following her refusal to sign the letter of consent. The respondent’s counsel even put it to her that because she had refused to give her consent she had placed herself in a better position that those who had signed it and therefore the respondent had to treat her differently and find another way to make the cuts. Following her refusal to sign the consent the respondent attempted to unilaterally alter the terms of her contract by reducing her working days from five to three and thus reducing her remuneration by 40%. That is a breach of her contract. It is a breach that goes to the root of her contract. It is a breach which prevented her from carrying out her contractual duties.
The Tribunal find that the claimant was constructively dismissed and according her claim under the Unfair Dismissals Act, 1977 to 2007 succeeds. “
OG v GT Company Limited
UD2314/2010
“The claimant was employed as a mechanic by the respondent company from October 2006. On 11 May 2010 he went on sick leave and did not return to work. He resigned by letter dated 8 September 2010.
Determination:
The claimant is alleging he was constructively dismissed from his employment with the respondent company. Section 1 of the Unfair Dismissal Act defines constructive dismissal as:
“the termination by the employee of his contract of employment with this employer whether prior notice of the termination was or was not given to the employer in the circumstances in which, because of the conduct of the employer the employee was or would have been entitled or it was or would have been reasonable for the employee to terminate the contract of employment without giving prior notice of the termination to the employer.” The burden of proof, which is a very high one, lies with the claimant. He must show that his resignation was not voluntary. The legal test to be applied is “an and or test”. Firstly, the Tribunal must look at the contract of employment and establish whether or not there has been a significant breach going to the root of the contract. If the Tribunal is not satisfied that there has been a significant breach of the contract it can examine the conduct of both the employee and employer together with all the circumstances surrounding the termination to establish whether or not the decision of the employee to termination the contract was a reasonable one.
The claimant made his claim for constructive dismissal under three separate headings:
– Excessive workload,
– Exclusion,
– Being subjected bullying, harassment and aggressive behaviour.
It is important to note from the outset that the claimant suffered from a syndrome known as Asperger Syndrome (A.S.) which falls into the category of autism spectrum disorders. From the evidence it was clear that the claimant was extremely intelligent and talented when it came to anything mechanical. However, for the normal day to day challenges life brings he relied heavily on his parents. The claimant’s father spoke to the employer at length prior to the claimant commencing his position with the respondent company. The purpose of the conversation was to inform or educate the employer in relation to A.S. and the challenges that that brings. The claimant commenced his employment in October, 2006 and worked without issue for a period of three years.
In March, 2009 the claimant suffered a personal injury at work when he was struck on the head by a tyre. He was certified unfit to work the next day but despite the certificate he attended for work as he was anxious to finish a car he was working on. There was a second incident when a tyre exploded in the vicinity of the claimant which caused his hearing some short term temporary distress. The claimant did not raise a formal grievance with the respondent company in relation to either of these incidents nor did he bring a personal injury claim.
There were several incidents where the claimant felt that inappropriate language was being directed towards him and on several occasions he felt that his employer personally belittled him by calling him, for example, “fucking stupid”. The employer stated in evidence that on occasion inappropriate language was used and that he did give out the claimant when things
were not being done. He stated that there were times that he just had to be the boss and he did not make exceptions for the claimant when his orders were not being followed. He explained to the claimant that on occasion he had to “be the boss” and that it was not personal. The employer should not be expected to make exceptions for the claimant when it came to matters of business. However, knowing how sensitive the claimant was to reprimand the employer could have taken a more gentle approach.
The claimant felt that he was being excluded. He gave an example that when his work colleagues would go for lunch nobody would call him and he would be left alone to work through his lunch. It is important to note that time means nothing to the claimant and a lunch hour could come and go without the claimant noticing. He would have to be called for his lunch otherwise he would not have known that it was lunch time. There probably were times when the employer or his employees neglected to call the claimant for his lunch but the Tribunal finds that there was no malice involved. The employer stated that he worked one on one with the claimant on most days and that he gave him as much of his attention as he could and if anyone was being excluded it was his other staff members.
When it came to including the claimant in staff activities, the employer made exceptions for the claimant. He did so due to the fact that he thought highly of him and knowing about A.S. One example of that was the Christmas party. The respondent’s staff planned a night out at the dogs. The claimant stated that he had no desire to go to the dogs as they did not interest him, so the employer organised a meal at a local Italian restaurant that the claimant liked. The employer, his staff, the claimant and his father attended for the lunch. The Tribunal note that the claimant’s father paid for the meal.
The claimant stated that he felt that the employer kept increasing his work load to the point that it was impossible for him to complete the work in any given day. When the work was not completed he stated that the employer reprimanded him and sometimes did so in a personal way and in front of other staff members. The employer stated that the claimant was so passionate about his work that sometimes he would get lost in it trying to solve problems that were outside his remit. He said that he found this frustrating and that he did have to reprimand the claimant from time to time. He also admitted that his choice of language could at times be colourful. The employer is within his rights to reprimand the claimant for not following orders, however, he should not have been reprimanded in public or in front of other staff members. To do so runs the risk of humiliating the claimant.
The claimant left his employment in May, 2010 and did not return due to stress, which both his parents and his GP say was work related. The employer stated that he did not know that the claimant was suffering from work related stress until the second sick certificate came in. The claimant stated that there was no contact with the employer after that. The employer stated that he did try to contact the claimant’s father on several occasions.
It is crucial in a constructive dismissal case that the claimant informs the employer fully of the complaints being made against him and that the employer be given an opportunity to resolve the issues. In this unusual case, the claimant’s parents had a duty to inform the employer why the claimant was suffering from stress and should have informed him that the claimant felt he was being subject to behaviour that amounted to bullying, harassment and exclusion. Their failure to do so left the employer powerless to rectify the situation.
Unfortunately the burden for the claimant is an extremely high one and the law makes no allowances, rightly or wrongly, for claimants who suffer from A.S. The claimant must show that there has been a significant breach going to the root of the contract, which said breach would prevent the claimant from carrying out his contractual duties. The Tribunal can find no evidence that there was such a breach of the claimant’s contract.
The Tribunal has examined the conduct of both the employee and employer together with all the circumstances surrounding the termination. Having done so cannot establish that theclaimant’s decision to termination the contract was a reasonable one.
The Tribunal has an enormous amount of respect and admiration for the claimant and what he has achieved but is bound by the law and therefore finds that the claim under the Unfair Dismissal Acts, 1977 to 2007, must fail. “
Kwik-Fit (GB) Ltd v Linehan
[1991] UKEAT 250_91_2410, [1992] ICR 183
Wood J
‘As we have said the industrial members take the view that the way in which this industrial tribunal have expressed themselves puts too high a burden upon employers. If words of resignation are unambiguous then prima facie an employer is entitled to treat them as such, but in the field of employment personalities constitute an important consideration. Words may be spoken or actions expressed in temper or in the heat of the moment or under extreme pressure (‘being jostled into a decision’) and indeed the intellectual make-up of an employee may be relevant: (and he gives a citation). These we refer to as `special circumstances’. Where `special circumstances’ arise it may be unreasonable for an employer to assume a resignation and to accept it forthwith. A reasonable period of time should be allowed to lapse and if circumstances arise during that period which put the employer on notice that that further inquiry is desirable to see whether the resignation was really intended and can properly be assumed, then such inquiry is ignored at the employer’s risk. He runs the risk that ultimately evidence may be forthcoming which indicates that in the `special circumstances’ the intention to resign was not the correct interpretation when the facts are judged objectively’.
Woods v WM Cae Services (Peterborough) Limited
[1981] IRLR 347
Browne-Wilkinson P
‘In our view it is clearly established that there is implied in a contract of employment a term that the employers will not, without reasonable and proper cause, conduct themselves in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between employer and employee: Courtaulds Northern Textiles Ltd v. Andrew [1979] IRLR 84. To constitute a breach of this implied term, it is not necessary to show that the employer intended any repudiation of the contract: the Tribunals’ function is to look at the employer’s conduct as a whole and determine whether it is such that its effect, judged reasonably and sensibly, is such that the employee cannot be expected to put up with it: see BAC Ltd v. Austin [1978] IRLR 332 and Post Office v. Roberts [1980] IRLR 347. . . We regard this implied term as one of great importance in good industrial relations. Quite apart from the inherent desirability of requiring both employer and employee to behave in the way required by such a term, there is a more technical reason for its importance. The statutory right of an employee who ceases to be employed to complain that he has been unfairly dismissed is wholly dependent on his showing that he has been ‘dismissed’. In the ordinary case, where an employer in fact dismisses the employee (ie cases falling within s.55(2)(a) and (b)) this normally presents no difficulty. The difficulty arises in cases of constructive dismissal falling within s.55(2)(c) where the employee has resigned due to the behaviour of the employer. As is well known, there used to be conflicting decisions as to whether, in order to constitute constructive dismissal, the conduct of the employer had to amount to a repudiation of the contract at common law or whether it was sufficient if the employer’s conduct was, in lay terms, so unreasonable that an employee could not be expected to put up with it. In Western Excavating (ECC) Ltd v. Sharp (supra) this conflict was resolved in favour of the view that the conduct of the employer had to amount to repudiation of the contract at common law. Accordingly, in cases of constructive dismissal, an employee has no remedy even if his employer has behaved unfairly, unless it can be shown that the employer’s conduct amounts to a fundamental breach of the contract. . . . Any breach of that implied term is a fundamental breach amounting to a repudiation since it necessarily goes to the root of the contract: see Courtaulds Northern Textiles Ltd v. Andrew (supra) at paragraph 11.’”
Nottinghamshire County Council v Meikle
[2004] EWCA Civ 859 [2004] IRLR 703
Lord Justice Keene:
“Constructive Dismissal:
The tribunal’s reasoning on this issue requires to be set out in full. The first two of the three crucial paragraphs in the Extended Reasons summarise counsel’s submissions, with paragraph 100 setting out the tribunal’s conclusions.
“98. [Counsel for the applicant] submitted that there was a course of conduct amounting to a fundamental breach of contract. He relied in particular on the decision to suspend the applicant, and the failure to address her concerns. The failure to respond adequately and/or positively to the letters from her representatives dated 8 and 31 March and 15 May 2000 and the first respondent’s actions amounted to the “last straw”.
99. [Counsel for NCC] submitted that the applicant did not maintain that she had lost trust and confidence in the first respondent. In any event there was no breach.
100. The Tribunal found that the applicant resigned because of the first respondent’s failure to agree to terms which her solicitors stated had to be met before she would return to work. These were set out in their letter dated 15 May 2000. That failure did not constitute a breach of contract. Even when it considered the course of events from 1993 the Tribunal did not decide that the first respondent’s actions were such that the applicant was entitled to resign from her employment without notice. In reaching that conclusion the Tribunal rejected [her counsel]’s submission that the implied term may be broken even if subjectively the employee’s trust and confidence was not undermined in fact. Almost immediately after her resignation the applicant successfully applied to re-enter the first respondent’s employment. In her originating application she asked for re-engagement. These matters demonstrated that the relationship of trust and confidence still subsisted. It was her relationship with the second respondent [Head Teacher] which had broken down. He was not her employer. She did not resign as a result of the first respondent’s conduct. It could not, therefore, be said that she had been constructively dismissed under the provisions of sections 95(1)(c) of the 1996 Act. Accordingly, the Tribunal decided to dismiss the complaint.”
……..In any event, the EAT held, NCC had itself been in fundamental breach because of the accumulation of acts by it, a series of actions over a period of time. They placed particular emphasis on the unjustified suspension of Mrs Meikle, as well as NCC’s continuing failure to deal with the two outstanding areas of discrimination. The latter, said the EAT, were sufficient to amount to the “last straw” and to find otherwise was perverse. Consequently the EAT concluded that Mrs Meikle had been constructively dismissed, and therefore wrongfully dismissed as well.
That analysis is now challenged by NCC. On its behalf, Mr Cavanagh QC, puts at the forefront of his case the submission that the EAT misconstrued paragraph 100 of the tribunal’s decision. It is argued that the tribunal found that the reason for Mrs Meikle’s resignation was NCC’s failure to agree to the four new requirements added in the second letter dated 15 May 2000 from her solicitors. That was a finding of fact, and a finding which was not perverse. The tribunal was entitled to conclude that that failure to accept those four requirements was not a breach of the implied duty of trust and confidence. Yet it is well established that, in order for there to be a constructive dismissal, the employee must leave in response to the fundamental breach of contract by the employer: Western Excavating (ECC) Limited –v- Sharp [1978] QB 761; [1978] IRLR 27. Consequently Mrs Meikle did not leave her employment in response to any breach of that term.
Mr Cavanagh emphasises that this is an argument about causation. It is not enough that the employer is in breach of the implied term of trust and confidence and that the employee resigns: the two events must be causally linked. It is accepted by NCC that, in the later part of paragraph 100, the tribunal went on to apply the wrong test when asking whether that implied term had been broken. Mr Cavanagh acknowledges that the test is an objective one, as appears from the House of Lords decision in Malik and Mahmund, and that the tribunal went wrong in saying that the term cannot be broken unless the employee’s trust and confidence has in fact been undermined. But it is contended that that does not matter, if the tribunal was right in the opening part of that paragraph to find that Mrs Meikle resigned in response to something which was not a breach of contract. That crucial paragraph should be seen as having two parts to it and the first is not vitiated by the error in the second part.
I entirely accept that it is a question of fact why Mrs Meikle resigned. Moreover, it is not in issue that, for a constructive dismissal to arise, the employee must resign in response to a fundamental breach of contract. That is demonstrated not only by Western Excavating (ECC) Limited –v- Sharp but also by Lewis –v- Motorworld Garages Limited [1986] ICR 157, where Glidewell LJ spoke of the employee having to show that he left “as the result of a breach of contract by his employer” (page 169).
……..It has been held by the EAT in Jones –v- Sirl and Son (Furnishers) Limited [1997] IRLR 493 that in constructive dismissal cases the repudiatory breach by the employer need not be the sole cause of the employee’s resignation. The EAT there pointed out that there may well be concurrent causes operating on the mind of an employee whose employer has committed fundamental breaches of contract and that the employee may leave because of both those breaches and another factor, such as the availability of another job. It suggested that the test to be applied was whether the breach or breaches were the “effective cause” of the resignation. I see the attractions of that approach, but there are dangers in getting drawn too far into questions about the employee’s motives. It must be remembered that we are dealing here with a contractual relationship, and constructive dismissal is a form of termination of contract by a repudiation by one party which is accepted by the other: see the Western Excavating case. The proper approach, therefore, 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. It follows that, in the present case, it was enough that the employee resigned in response, at least in part, to fundamental breaches of contract by NCC.
It was not really argued before us that the persistent failure of NCC to carry out those reasonable adjustments did not amount to a fundamental breach. The tribunal found that they amounted to unlawful discrimination and, given the duration of them and the finding that, even at the time of her resignation, there would have been little improvement in cover if Mrs Meikle had returned to work, it seems to me to be clear that NCC was in breach of its obligation to maintain the trust and confidence of its employee. There are many cases where similar or lesser failures in respect of discrimination have been held to breach that implied term, such as Bracebridge Engineering Limited –v- Darby [1990] IRLR 3, where the EAT held that the failure by an employer to treat an allegation of sexual harassment seriously was a breach of that implied term, which entitled the employee to treat the contract as having been repudiated.
Consequently the tribunal erred in law in concluding that NCC’s failure to agree to the conditions set out by Mrs Meikle’s solicitors did not constitute a breach of contract. Their failure was not merely a breach but sufficiently fundamental as to amount to repudiation of the contract. Moreover, the tribunal found that the relationship between Mrs Meikle and the Headteacher, Mr Lamb, had broken down and implicitly that she had resigned, in part, because of that. I accept that not every piece of adverse conduct on the part of one employee towards another will cause a breach of the implied term of trust and confidence between employer and the second of those employees. But Mr Lamb was the Headteacher at the school in which Mrs Meikle had taught since 1985. She had been experiencing problems about the enlargement of materials at the school since 1993, and neither Mr Lamb nor NCC had dealt adequately with those problems, any more than they had dealt with the problem of free time and cover. It would be remarkable indeed if Mr Lamb’s failure did not amount to a breach by NCC of its duty of maintaining trust and confidence on Mrs Meikle’s part.
But even if the tribunal had been right that the matters which led to her resignation were not in themselves a breach of contract, that would not have been the end of the story. Such a finding would not have necessarily produced the conclusion that there was no constructive dismissal. In cases where a course of conduct or a series of events leads to a breach of the implied term, the final event which brings about the employee’s resignation need not itself amount to a breach of contract. That was so held in Wood –v- W.M. Car Services (Peterborough) Limited [1981] I.C.R. 666, a decision which was approved by this court in Lewis –v- Motorworld Garages Limited, where Glidewell LJ said at page 169:
“(3) The breach of this implied obligation of trust and confidence may consist of a series of actions on the part of the employer which cumulatively amount to a breach of the term, though each individual incident may not do so. In particular in such a case the last action of the employer which leads to the employee leaving need not itself be a breach of contract; the question is, does the cumulative series of acts taken together amount to a breach of the implied term? (See Woods v. W. M. Car Services (Peterborough) Ltd [1981] I.C.R. 666.) This is the “last straw” situation.”
This is the very reason why the tribunal here went on to consider whether the course of events from 1993 onwards amounted to such a breach. In the light of its earlier view that the trigger for the resignation was not a breach of contract, it had to consider that issue.
However, it patently erred when it did so. It rejected the “last straw” argument because it applied the subjective test of asking whether the employee’s trust and confidence had in fact been undermined. Even if that had been the appropriate approach, the conclusion that Mrs Meikle’s trust and confidence remained despite her relationship with the Head teacher having broken down is an unsustainable one. But the test itself is wrong in law. As Lord Nicholls said in Malik and Mahmud (page 35 E):
“Proof of a subjective loss of confidence in the employer is not an essential element of the breach.”
As I have already noted, the appellant does not now seek to argue to the contrary. It follows that the tribunal fell into error when it considered, as it had to, the “last straw” argument, and the EAT was right in so concluding.
It is contended by the appellant that, having reached that conclusion, the EAT should have remitted the case to the tribunal below for it to reconsider the issue of constructive dismissal and wrongful dismissal. Mr Cavanagh argues that the situation in which Mrs Meikle found herself was improving by May 2000. It cannot be said that the only conclusion which could be reached on the primary facts was that she had been dismissed rather than that she had resigned.
I disagree. Once it is clear that the NCC was in fundamental breach, as it patently was, the only question is whether Mrs Meikle resigned in response to the conduct which constituted that breach. I have concluded already that that was the finding of the tribunal. In those circumstances there could be only one outcome, namely that she had been constructively dismissed. The EAT was entitled therefore to substitute such a finding.”
Sovereign House Security Services Ltd v Savage
[1989] IRLR 115
CA May LJ
‘In my opinion, generally speaking, where unambiguous words of resignation are used by an employee to the employer direct or by an intermediary, and are so understood by the employer, the proper conclusion of fact is that the employee has in truth resigned. In my view Tribunals should not be astute to find otherwise.’ But he then continues: ‘However, in some cases there may be something in the context of the exchange between the employer and the employee or, in the circumstances of the employee him or herself, to entitle the Tribunal of fact to conclude that notwithstanding the appearances there was no real resignation despite what it might appear to be at first sight.’ and
‘There was that evidence from those two witnesses on which in my judgment it was possible for the Industrial Tribunal, were they so minded, having seen and assessed the witnesses giving evidence in the witness-box, to conclude that the words actually used by the employee to Scoggie were used in the heat of the moment and should not have been accepted at full face value by the employers. There was thus, in my opinion, evidence entitling the Industrial Tribunal to make the findings which they did in paragraph 7 of their decision, which was, as I think, just as much one of fact as their findings of fact set out in paragraph 4 of the decision, that ‘the applicant was not tendering his resignation to Mr Scroggie’.’
Horkulak v Cantor Fitzgerald International
[2003] EWHC 1918
Mr Justice Newman :
“The Legal Framework for the consideration of the case
Liability
In order for the claimant to succeed in a claim for wrongful dismissal he must establish:
(1) A breach of contract by the defendant.
(2) That the breach was sufficiently serious to have justified the claimant resigning, or at least be the last in a series of events which justified his leaving.
(3) That he left his employment with the defendant in response to that breach and not for some other unconnected reason.
Western Excavating v Sharp [1978] QB 761 at 769A-C (Lord Denning MR). The defendant does not contend that the claimant elected to affirm the contract.
Implied term of trust and confidence
The leading authority on the implied term of trust and confidence is now the decision of the House of Lords in Mahmud & Malik v BCCI [2000] AC 20. See the speech of Lord Steyn at 45 c-D:
“The applicants do not rely on a term implied in fact. They do not therefore rely on an individualised term to be implied from the particular provisions of their employment contracts considered against their specific contextual setting. Instead they rely on standardised term implied by law, that is, on a term which is said to be an incident of all contracts of employment: Scally v Southern Health and Social Services Board [1992] 1 AC 294, 307B. Such implied terms operate as default rules.”
Lord Steyn adopted the definition of this term set out in Woods v W M Car Services (Peterborough) Ltd [1981] ICR 666 and approved by the Court of Appeal in Lewis v Motorworld Garages Ltd (1986) ICR 157 and also by Sir Nicholas Browne-Wilkinson VC in Imperial Group Pension Trust Ltd v Imperial Tobacco Ltd [1991] WLR 589, that an employer shall not:
“without reasonable and proper cause, conduct itself in a manner calculated and likely to destroy or seriously damage the relationship of confidence and trust between employer and employee.”
Lord Steyn further set out that (p45H-46D):
“….The major importance of the implied duty of trust and confidence lies in its impact on the obligations of the employer…..And the implied obligation as formulated is apt to cover the great diversity of situations in which a balance has to be struck between an employer’s interest in managing his business as he sees fit and the employee’s interest in not being unfairly and improperly exploited.
“The evolution of the implied term of trust and confidence is a fact. It has not yet been endorsed by Your Lordships’ House. It has proved a workable principle in practice. It has not been the subject of any adverse criticism in any decided cases and it has been welcomed in academic writings. I regard the emergence of the implied obligation of mutual trust and confidence as a sound development.”
Lord Nicholls described the implied obligations as (p35A-B):
“….no more than one particular aspect of the portmanteau, general obligation not to engage in conduct likely to undermine the trust and confidence required if the employment relationship is to continue in the manner the employment contract implicitly envisages.
“…The conduct must, of course, impinge on the relationship in the sense that, looked at objectively, it is likely to destroy or seriously damage the degree of trust and confidence the employee is reasonably entitled to have in his employer” (p35C-D).
The term was further considered by the House of Lords in Johnson v Unisys [2003] 1 AC 518 in the context of the termination of an employment relationship. In Johnson Lord Hoffman also had regard to the evolution of the implied term of trust and confidence. He stated (at 539A-D):
“At common law the contract of employment was regarded by the courts as a contract like any other….But over the last 30 years or so, the nature of the contract of employment has been transformed. It has been recognised that a person’s employment is usually one of the most important things in his or her life. It gives not only a livelihood but an occupation, an identity and a sense of self-esteem. The law has changed to recognise this social reality. Most of the changes have been made by Parliament. The Employment Rights Act 1996 consolidates numerous statutes which have conferred rights upon employees. European Community law has made a substantial contribution. And the common law has adapted itself to the new attitudes, proceeding sometimes by analogy with statutory rights.
“The contribution of the common law to the employment revolution has been by the evolution of implied terms in the contract of employment. The most far reaching is the implied term of trust and confidence.”
The test as to whether there has been a breach of the implied term of trust and confidence is an objective one. As Lord Steyn put in Mahmud & Malik (p 47G-H):
“The motives of the employer cannot be determinative or even relevant, in judging the employees’ claims for damages for breach of the implied obligation. If conduct objectively considered is likely to cause serious damage to the relationship between employer and employee a breach of the implied obligation may arise.”
Furthermore, an employer can breach the implied term of trust and confidence by one act alone or by a series of acts which cumulatively amount to a repudiatory breach of contract, even if the last even in that series is not actually a breach of contract at all: see Lewis v Motorworld Garages Ltd [1986] ICR 157 in which Glidewell LJ stated:
“This breach of this implied obligation of trust and confidence may consist of a series of action on the part of the employer which cumulatively amount to a breach of the term, though each individual incident may not do so. In particular in such a case the last action of the employer which leads to the employee leaving need not itself be a breach of contract; the question is, does the cumulative series of acts taken together amount to a breach of the implied term? (see Woods v W M Car Services (Peterborough Ltd” [1981] ICR 666. This is the ‘last straw’ doctrine.”
Where the repudiatory breach alleged is of the trust and confidence term:
“The misconduct of the employer amounting to breach must be serious indeed since it amounts to constructive dismissal and as such entitles the employee to leave immediately without any notice on discovering it. The test is whether the employer’s conduct is such that the employee cannot reasonably be expected to tolerate it a moment longer after he has discovered it and can walk out of his job without prior notice”. BCC1 v Ali (No 2) [2000] ICR 1354, 1376H.”
There is no question of a contractual term that an employer must behave “reasonably” (or “not unreasonably”): that is a matter for the employment tribunal. Moreover, an employer may engage in conduct which is “out of order” without thereby repudiating the contract, although repeated behaviour of that kind may be a different matter. Cantor Fitzgerald v Bird [2002] IRLR 867, SS28.
The test to be applied is not subjective. The employee’s actual perception is not material. The test is an objective one; that is whether viewed objectively, the employer’s conduct so impacted on the employee that the employee could properly conclude that the employer was repudiating the contract. Brown v Merchant Ferries [1998] IRLR 682, NICA.
A number of points having particular relevance to the facts of this case can be extracted from a detailed consideration of the speeches in the House of Lords in Mahmud and Johnson v Unisys.
i) The notion of an employment contract giving rise to a “master and servant” relationship is now obsolete. (Lord Steyn, Mahmud. 45H – 46A)
ii) The obligation of mutual trust and confidence has emerged from the general duty of co-operation between contracting parties. (See Professor Brodie: (1996) 25 ILJ 121)
iii) The relationship remains defined by the respective role and responsibilities of the employer and the employee. The employer has the right to exercise authority and to instruct and direct, namely to “manage his business as he sees fit” and the employee has a duty to comply with reasonable instructions and directions. The responsibility for the running of the business and the methods of achieving the legitimate aims of the business ultimately lie with the employer.
iv) Given that the respective roles are, at their elemental level, as in (iii) above, the movement away from a master and servant relationship requires particular attention to the element of co-operation which underpins the character of the contract of employment. An employee’s participation in the business cannot simply be regarded as the work of a servant for the benefit of the employer, but has to be recognised as “….one of the most important things in his or her life. It gives not only a livelihood but an occupation, an identity and a sense of self-esteem.” (Lord Hoffmann Johnson v Unisys 539 B-C)
v) In a master and servant relationship, the benefit for the servant was to be paid a wage. The “co-operation” required of an employer, to which a contract of employment gives rise in modern times, cannot be met simply by remuneration, nor, in my judgment, can the level of it affect the principle which is now in play. I reject as fallacious the proposition, which has surfaced in argument from time to time, that where very substantial sums are paid by an employer, he acquires a right to treat employees according to a different standard of conduct from that which might otherwise be required.
vi) In the instant case the thrust of some of the argument has been to the effect that huge salaries are paid in broking houses because employees may be subjected to stress, anxiety and summary treatment. As the expression goes, “if you can’t stand the heat of the kitchen, get out”. Obviously the court must recognise and pay regard to the character and nature of the business in question. But due regard will not exclude the application of the law as it has developed, for as Lord Steyn observed in Johnson v Unisys Ltd (paragraph 19 532 B-F):
“….stress-related psychiatric and psychological problems of employees…..[have] greatly increased”
“These considerations are testimony to the need for implied terms in contracts of employment protecting employees from harsh and unacceptable employment practices.”
“Inevitably, the incidence of psychiatric injury due to excessive stress has increased. The need for protection of employees through their contractual rights, express and implied by law, is markedly greater than in the past”.
vii) The particular role and status of an employee will define the character and degree of co-operation to which the contract of employment gives rise. For example a senior manager is likely to perform some of the employer’s functions and will be seen by employees to be doing so, whilst also being subject to a more senior manager who is his employer.
viii) A senior manager can co-operate in a business at a high level of involvement. In the performance of his contract he needs to cultivate and maintain the confidence of those employees over whom he exercises managerial control and he needs the support and co-operation of his “employer”, more senior management, to carry out his duties in this regard and generally. Since he has managerial duties, his judgment having been invoked cannot properly be subjected to instant and dismissive conclusions which accord no respect to his viewpoint. Co-operation at this level takes on characteristics akin to partnership. In this connection the so called “blood oath” agreement is not without relevance.”
O’C v Homecare Medical Supplies
MNDeputy Chairman
Petkus & ors -v- Complete Highway Care Limited
Cases Constructive Dismissal
T.E. Laboratories Limited v Jakub Mikolajczyk
Determination Number UDD1930
Labour Court
11 June 2019
[2019] 30 E.L.R. 198
Background
The worker appealed the recommendation of the Adjudication Officer to the Labour Court on 25 September 2018 in accordance with s.8A of the Unfair Dismissals Act 1977 to 2015. A Labour Court hearing took place on 30 May 2019. The following is the Determination of the Court.
Determination
This is an appeal by Mr Mikolajczyk (the “complainant”), against a decision of an Adjudication Officer, (AO) of the Workplace Relations Commission, (WRC), that he was not constructively dismissed by T.E. Laboratories Ltd (the “respondent”), contrary to the terms of the Unfair Dismissals Act.
The complainant worked for the respondent from June 2010. On 28 June 2017, the date that he ceased to work for the respondent, he was a warehouse manager.
In early 2016, an anonymous tip was given to the respondent regarding possible theft of stock and, following six months’ monitoring by the respondent, another member of staff, (MH), was arrested and he admitted the unauthorised removal and sale of chemicals. He stated that he had acted alone. The Garda inquiry did not find that any other staff member had a case to answer.
Evidence was given to the court that all members of staff were interviewed. *201 In the complainant’s case, he was interviewed on six occasions in August 2016. The court heard that the complainant felt that these meetings were aggressive and accusatory. The respondent described them as “robust”.
The complainant remained in work. In January 2017, the complainant was required to attend a number of disciplinary meetings. These meetings were chaired by an outside consultant, Mr Liam Barton. In February 2017, in circumstances that were disputed, the complainant was suspended on full pay. It is not in dispute that the complainant and his representative, Mr Bill Canning, asked that he not be suspended. Nor is it disputed that the workforce was advised of the suspension, though the reason for this and the consequences are a source of contention.
In March 2017, Mr Barton issued his decision that the complainant should be issued with a final written warning to remain on his file for 12 months. A letter was sent to the complainant inviting him back to work.
The complainant submitted medical evidence that he was unfit to return to work.
The complainant appealed the decision. This appeal was heard by another outside consultant, Ms Helena Broderick. She upheld the decision.
The complainant did not return to work. Evidence was given on behalf of the respondent of the efforts made to encourage his return. On receipt of further medical certification, the company arranged for the complainant to be seen by a medical advisor. At the end of May, the complainant kept this appointment. The medical advisor certified that the complainant was upset by a difficult work situation and that he should remain on sick leave for a further four to six weeks, after which he ought to be able to return to work.
On that same day, the complainant’s solicitors wrote to the respondent rejecting the appeal findings, seeking the removal of the final written warning from the complainant’s file, seeking an undertaking that no further disciplinary action would be taken, seeking an explanation for the complainant’s suspension, seeking an apology to the complainant and seeking an undertaking that the respondent would take all necessary steps to ensure a safe workplace to which the complainant could return.
The respondent replied that the disciplinary process was exhausted, that they were awaiting the medical report and, when it was received, they would work with the complainant to assist his return to work.
The complainant’s solicitors responded to say that, as the company refused to rescind the grossly unfair sanction, he felt that he had no option but to resign his employment. Further correspondence did not change the position.
The complainant lodged a case with the WRC alleging constructive dismissal.
The AO found that the claim was not well grounded.
The complainant appealed this decision to the court.
*202
Complainant’s arguments
The complainant, as warehouse manager, was interviewed six times in August 2016. These interviews were ostensibly carried out to secure evidence from the complainant as a witness. However, they were aggressive and threatening, (extracts from minutes of these meetings were provided to the court).
Examples of this behaviour include the managing director, Mr Mark Bowkett, making statements to the effect that he was suspicious of the complainant, that the theft could not have occurred without the complainant’s knowledge, that he was tipping off MH, that the company had lost trust in the complainant and that if the matter went to “disciplinary … it [would] go one way”.
After these meetings, the complainant felt physically ill and stressed. He also felt that there was a different attitude to him from management.
After a short period of sick leave, at a “return to work” meeting with Ms Catriona O’Reilly of human resources, the complainant ascribed his illness to the accusations and the threat of losing his job. Ms O’ Reilly denied that this had happened.
The complainant believed that pointed comments by a manager that products needed to be locked up or they would “grow legs and walk” were directed at him. He believed also that a statement by Mr Bowkett that all export shipments would have to be reviewed by the company was directed at him as Mr Bowkett had given him permission to make a private shipment of an item to Japan, at the complainant’s expense.
Then at his general appraisal meeting, derogatory remarks were made about work that he had done previously, for which he had been commended and rewarded and unfavourable comparisons were made with the work being done by a person who had taken on the particular task.
Then, months later, in early December 2016, the complainant was notified of a disciplinary hearing for what was described as “Gross Misconduct for Negligent Performance of Duties”.
This meeting took place on 12 January 2017 and the questioning was continuous and relentless.
At the end of the meeting, Mr Bowkett told the complainant that he was being suspended. Mr Canning protested the decision on behalf of the complainant but the decision was confirmed by email the following day. All staff were informed of this suspension and that the complainant would not be back to work for the foreseeable future. This caused the complainant great reputational harm and considerable distress. The complainant believed that this showed again that there was a lack of trust in him and that it was a signal that his employer believed that he had no future with the business.
The complainant believes that there was a lack of processes in place to protect the stock and that he was a scapegoat.
*203
Following his suspension, the complainant was so stressed that he could not deal directly with the respondent and all correspondence was requested to be sent to his solicitor. Indeed, he required permission from his doctor to attend the appeal hearing.
The meeting with the respondent’s medical advisor was very positive. She advised him to start looking into other employment options as she could see that his work situation was unsustainable.
When the complainant’s solicitor wrote to the respondent seeking removal of the final written warning and an apology, he felt that, if these were forthcoming, he could have regained the respect of his colleagues and that, perhaps, he could have begun to rebuild the required trust between an employee and employer. Mr Bowkett refused to engage on these matters, so, with great reluctance but because he could have no faith in his employer, in light of its treatment of him, the complainant felt that he was left with no option but to resign.
Respondent’s arguments
In July 2016 an incident arose in the company. The complainant was interviewed as a witness. It was only when this investigation was completed that questions arose regarding the complainant, who was then the subject of a disciplinary process.
The complainant was invited to a disciplinary hearing and was advised that the issues for discussion would be:
— ordering stock which was not required;
— not following director’s instructions regarding keys for containers;
— knowing that stock was being taken and not stopping it or bringing it to the respondent’s attention;
— failure to report missing stock;
— agreeing to change a procedure whereby expensive stock was no longer accounted for;
— failure to report inappropriate and uncontrolled storage of dangerous chemicals;
— inability/refusal to provide adequate details at the earlier interviews.
A disciplinary hearing took place on 12 January 2017. It was chaired by an outside consultant, Mr Liam Barton.
Also in attendance was Mr Mark Bowkett and Ms Audrey McGrath, note-taker.
The complainant was present and represented by Mr Bill Canning. All points were discussed in detail. The transcript was provided to the complainant.
A further detailed meeting took place on 15 February 2017 and, subsequently, information requested by the complainant’s solicitor was provided.
*204
Mr Barton’s decision was issued on 28 February 2017. He decided that the complainant should receive a final written warning based on:
— errors in ordering additional stock not required;
— failure to comply with stock recording procedures;
— granting a request from MH regarding the location of certain product without referring this to a manager or director;
— failure to take reasonable steps to control stock.
This final written warning was to remain on the complainant’s file for 12 months.
The complainant was advised of his right to appeal and was invited to return to work.
The complainant indicated an intention to appeal but sought a number of assurances before returning to work. The respondent replied that the disciplinary process was completed and that the complainant had the right to appeal.
Ms Helena Broderick, an outside consultant, was appointed to hear the appeal. In March 2017, the complainant was given medical permission to attend the appeal.
In April 2017, Ms Broderick issued her detailed report rejecting the appeal.
Further correspondence regarding the complainant’s health problems then ensued and the respondent referred the complainant to their medical advisor. Her report dated 2 June 2017 stated that the complainant was unfit to work for a further four to six weeks, after which he would be able to resume.
That same day, the complainant’s solicitor wrote rejecting the decision on the appeal, seeking the removal of the final written warning and an apology plus other assurances. The respondent reiterated that the disciplinary process had concluded and that once the medical issues were resolved they were happy to work with the complainant in assisting his return to work.
On 19 June 2017, the complainant’ solicitor wrote to say that as the disciplinary sanction had not been rescinded, the complainant felt that he had no option but to resign.
The respondent replied to the solicitor and directly to the complainant expressing disappointment with his decision and asking him to return. The complainant’s solicitor then wrote to say that the complainant’s decision was final.
The Unfair Dismissals Act 1977, as amended, defines constructive dismissal in terms where it is “reasonable for the employee, to terminate the contract of employments…”. The respondent’s actions did not give rise to such circumstances.
The principles established require the complainant to show either a breach of contract or that the actions of the employer were so unreasonable that continuation of employment would be intolerable. Neither applies in this case.
*205
The respondent fulfilled its contractual obligations in full. In the lengthy process of investigation, disciplinary and appeal, the complainant was given the opportunity to present his case and he was given the right to representation. Following the decision regarding a sanction, every effort was made to engage with the complainant and to encourage his return to work.
The complainant had other avenues available to him to contest the sanction rather than resigning, including the use of the company’s grievance procedure or accessing the WRC.
Both the disciplinary hearings and the appeal were conducted by outsiders independent of the respondent.
Case law, (cited to the court), shows that there is a high burden of proof on an employee in a case of constructive dismissal to show that he acted reasonably in resigning and also that all available processes had been exercised prior to resignation.
With regard to the issue of the complainant’s suspension, this was a “holding” suspension and was not “punitive”. The AO had accepted that this was “a legitimate precaution” and that the rumour mill would have been well underway prior to the suspension, which would not have “added much to the story”.
Witness evidence
Mr Jakub Mikolajczyk
Mr Mikolajczyck, the complainant, gave evidence of his career with the respondent and his duties.
He recounted how he was invited to a series of six meetings from the end of July 2016 at which he believed he was ambushed and accused of being a co-conspirator in the matter being investigated, in a fashion that he found to be confrontational and intimidating.
It became clear to him that his employer had lost trust in him and because of his treatment, he lost some trust in his employer. He felt that he was being threatened with dismissal in some of the comments by Mr Bowkett regarding what was likely to happen.
He felt that he was being scapegoated for poor controls which were in place.
He continued working for five months after these interviews, during which period he felt that management’s attitude to him had changed. He expanded on how he felt Mr Bowkett’s curtailment of shipping had been aimed at him and how he felt that comments by another director regarding product gaining legs and walking was also aimed at him. He also recounted how he felt his previous work was belittled in his annual appraisal, despite the fact that he had been commended for it and had received an award.
He described his shock at being suspended at the first disciplinary meeting. His representative had pleaded for him not to be suspended but Mr Bowkett had *206 gone ahead with the suspension, allegedly so that the witness would have enough time to go through all the relevant documentation. He stated that no alternatives to suspension were considered. This decision had then been conveyed to the entire workforce.
He believed that Mr Bowkett, who was involved in both the investigation and the disciplinary process, had his mind set on the matter.
The witness described the appeal process as brief and narrow and he disagreed with the outcome. He described how he was so unwell that he needed medical permission to attend the appeal hearing. He was suffering from stress brought on by his work situation and said that this was recognised by the respondent’s medical advisor.
The witness said that the way he was treated led him to lose all trust in his employer and, when they refused to rescind the disciplinary action and apologise, he felt that he had no option but to resign. He had suffered huge stigma in a small community.
The witness stated that he had been unemployed for a lengthy period after he left this employment. He had accounts with three employment websites and had put himself forward for interview. He had looked for work as far as Dublin. Eventually, he secured two to three days’ work per week with a building contractor.
Under cross-examination and questions from the court, the witness denied that he was a qualified painter. He described his loss of social life and how, for a period, he had stopped playing football.
The witness said that initially he was interviewed as a witness. He acknowledged that he was known to be good at assessing stock and described how he did regular walk-arounds. When put to him that he should have been able easily to answer questions, the witness said that there were many different items of stock and he could not give details about all products.
He accepted that he was not mentioned by name in the comment about product growing legs but said that he felt that this was directed at him, as was the matter of the shipping by him of an item to Japan and the changes made to the shipping policy. With regard to the latter, he acknowledged that the changed arrangements affected others also.
It was put to him that the suspension was for a few days to allow him to review documents and that the delay in his return had been due to delays in his response. He stated that he did not need time off to review documents and had asked to be allowed to remain at work and that, by being off work, he had no access to the system to track back on stock. Mr Bowkett had agreed to consider this but had subsequently confirmed the suspension.
When put to him that stock had suddenly re-appeared he said that had nothing to do with him.
*207
He stated that between the interviews and the disciplinary meeting, he had been told that the company was gathering evidence, something that the company says was not so.
The witness described his shock at the disciplinary outcome as he had done nothing wrong.
He stated that after the theft he had not been allowed near stock, showing that he was not trusted and, as a result, he did not trust his employer. When put to him that it was not true that he was kept away from the stock, the witness stated that this part of his work was assigned to a different person.
He restated that the penalty imposed was unfair and felt that he had been treated throughout as if he were guilty.
The witness stated that while others were interviewed, he had been the only staff member interviewed on six occasions, despite the fact that he was, supposedly, only a witness.
When asked why he had not utilised the grievance procedure in the company, despite being invited to do so, after he had stated his intention to resign, the witness said that he could no longer trust his employer.
Mr Mark Bowkett
Mr Bowkett stated that he was the managing director of the respondent. He stated that had known the complainant prior to the events in question and that the complainant had been a trusted employee.
Following the theft, all staff had been interviewed, some more than once and sanctions had been applied to a small number of staff.
He described the investigation meetings with the complainant as “robust” and acknowledged that he had said the things attributed to him but he stated that a full reading of the transcripts would show that he had also positive comments to make about the complainant. He described a process in which, as he put it, the complainant started at a certain point and ended at another point. The company was attempting to pinpoint the scale of fraud and the meetings with the complainant had become robust because it was difficult to get information from him.
Subsequent to the meetings, he described his relationship with the complainant as “strained” as it was with other employees also. He denied that the change in shipment arrangements was aimed at the complainant and noted that he had suffered himself as a consequence of the change to a great degree also. With regard to his colleague’s comment about stock growing legs, this related to stock going missing then reappearing, which had never been explained.
When asked to explain the delay between the August meetings and the initiation of the disciplinary process, the witness stated that, in that time, the company was assisting Gardaí in compiling a book of evidence, so that they *208 were investigating and auditing.
He described the hiring of Mr Barton to chair the disciplinary proceedings and how Mr Barton had provided some management training for the company previously.
With regard to the decision to suspend, the witness stated that a lot of the material to be covered had been rolled on to a second day and required considerable scrutiny of documentation. To allow the complainant the necessary time for this, he felt that he should be suspended with pay. Having been asked by Mr Canning not to do this, he agreed to think it over. He took legal advice and confirmed the decision.
The witness stated that all relevant information was given to the complainant and only one further meeting was necessary.
The witness outlined that Mr Barton issued his finding, this was conveyed to the complainant and that the witness expected the complainant to return to work. He acknowledged that this would have its difficulties but he expected that it would be possible to rebuild the relationship.
He explained that the role change for the complainant would have helped him to concentrate on management and that the stock control function could be spread across the company.
Under cross-examination and questions from the court, the witness explained that his role in the initial meetings was to gather information. His role in the disciplinary process was as “charging officer”, i.e. he presented information but was not the decision-maker, that role was Mr Barton’s alone. He did not accept that he should have excluded himself from the disciplinary process because of his role as an investigator. It was his decision to charge the complainant with “gross misconduct”. He accepted that the invitation letter should have been headed “alleged gross misconduct” but did not accept that this showed he had made up his mind on the matter, stating that he would not have followed this process if that was the case.
When asked to justify the charge, the witness said that he had weighed all the evidence and he denied that the charge was inappropriate and unfair. He stated that the basis of the seven charges was set out in the book of evidence given to the complainant.
The witness explained that Mr Barton’s decision had to be sanctioned by the company.
On the question of the suspension, the witness restated that its sole purpose was to give the complainant the necessary time to consider all documentation. He had not considered alternatives.
The witness said that in informing staff of the suspension, the respondent was very clear in telling them that this did not imply guilt and that the complainant might return to the company. He said that while he could understand the *209 complainant’s trust issues, he felt that it was a huge jump to resignation.
The witness confirmed that no disciplinary investigation had been undertaken prior to the disciplinary proceedings and he confirmed that the complainant had been invited to the initial meetings in the role of witness. When it was put to him that the absence of such an investigation deprived the complainant of an opportunity to input prior to the consideration of possible charges and that this was contrary to the guidelines on disciplinary procedures set out in the Industrial Relations Act 1990 (Code of Practice on Grievance and Disciplinary Procedures) (Declaration) Order 2000 (S.I. No. 146 of 2000), the witness stated that he still felt that the complainant’s resignation was not necessary.
Ms Helena Broderick
Ms Broderick told how she is a HR consultant and how she was hired by the respondent to deal with the complainant’s appeal.
She described how she reviewed Mr Barton’s analysis, how she looked at Mr Bowkett’s role, how she looked to see if the evidence supported the conclusions and how she had gone through the grounds of appeal. She stated that she was satisfied that there were changes in stock ordering, absences of adequate checks by the complainant, unexplained changes in order patterns, failure to be compliant with procedures and failure to log into the diary.
She upheld the decision to issue a final written warning.
She upheld the decision to suspend also. In her report, she noted that the suspension had been for two reasons, first, to allow the complainant to review documentation and secondly, because two days before the disciplinary hearing an order of Polyvials had been discovered. When put to her that no reference had been made to the latter reason in communication with the complainant, the witness stated that this had been conveyed to her by, she believed, Ms Catriona O’Reilly, the company’s HR manager.
It was put to the witness that there had been no disciplinary investigation, there had been a gap of five months between meetings with the complainant in his role as a witness and disciplinary proceedings and now it had emerged that there was a second reason behind the decision to suspend that had not been shared with the complainant. In light of this, she was asked if she still felt the decision to suspend and to impose a final written warning should be upheld. The witness replied that any alleged flaws in the process had not been raised at the appeal. She accepted that the absence of a “bridge” between the initial meetings and the disciplinary process was not good practice and with regard to the suspension, she relied on the evidence that she had.
Ms Catriona O’Reilly
Ms O’Reilly stated that she was a general manager including HR manager. She gave evidence of attending all investigatory meetings and told how sanctions *210 had been imposed on four people, including the complainant.
She told how she had compiled the documentation for the complainant’s disciplinary meetings.
On the question of the suspension, the witness explained that possible irregularities regarding Polyvials came to light just two days before the disciplinary hearing. In any event, the complainant needed time to go through all documentation. When asked why she had not suggested administrative leave rather than suspension, she said that she felt that they would amount to the same thing.
The witness stated that her next involvement was to convey Mr Barton’s decision, to advise the complainant of his right to appeal and that she invited the complainant back to work.
She stated that she appointed Ms Broderick. She reiterated the sequence of events subsequent to her conveying the appeal outcome and the referral of the complainant to the respondent’s medical advisors.
She stated that she was surprised at the complainant’s failure to return to work and had suggested that he use the company grievance procedure. She felt that there was nothing involved that could not be resolved.
Under cross-examination, it was drawn to the witness’ attention that it was not possible to use the company grievance procedure to query a disciplinary outcome and that under the disciplinary process of the company, the decision of the chairperson was final, subject only to the appeal. The witness did not accept that this left the complainant with no alternative but to resign and she said that she did not understand why the complainant had not suggested some alternative way to deal with the matter.
The witness did not change her view when it was noted that the transcript of the meeting at which the complainant was advised of the intention to suspend makes no reference to any issue with Polyvials, that no documentation was put to him on the matter at that meeting and that the letter of suspension makes no reference to any such matter. She echoed the view of Mr Bowkett that this letter could be described as terse. Nor did the witness change her view when it was put to her that the absence of a disciplinary investigation was in breach of the guidelines set out in the Industrial Relations Act 1990 (Code of Practice on Grievance and Disciplinary Procedures) (Declaration) Order 2000 (S.I. No. 146 of 2000).
The law
Dismissal is defined in s.1 of the Unfair Dismissals Act 1977, as amended, as follows:
“‘dismissal’, in relation to an employee, means—
(a) the termination by his employer of the employee’s contract of employment *211 with the employer, whether prior notice of the termination was or was not given to the employee,
(b) the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer…
Section 6 (1) of the Act states:
“6.—(1) Subject to the provisions of this section, the dismissal of an employee shall be deemed, for the purposes of this Act, to be an unfair dismissal unless, having regard to all the circumstances, there were substantial grounds justifying the dismissal.”
Redress for unfair dismissal is provided at s.7:
“7.—(1) Where an employee is dismissed and the dismissal is an unfair dismissal, the employee shall be entitled to redress consisting of whichever of the following the adjudication officer or the Labour Court, as the case may be, considers appropriate having regard to all the circumstances:
(a) re-instatement by the employer of the employee in the position which he held immediately before his dismissal on the terms and conditions on which he was employed immediately before his dismissal together with a term that the re-instatement shall be deemed to have commenced on the day of the dismissal, or
(b) re-engagement by the employer of the employee either in the position which he held immediately before his dismissal or in a different position which would be reasonably suitable for him on such terms and conditions as are reasonable having regard to all the circumstances, or
(i) if the employee incurred any financial loss attributable to the dismissal, payment to him by the employer of such compensation in respect of the loss (not exceeding in amount 104 weeks’ remuneration in respect of the employment from which he was dismissed calculated in accordance with regulations under section 17 of this Act) as is just and equitable having regard to all the circumstances, or
(ii) if the employee incurred no such financial loss, payment to the employee by the employer of such compensation (if any, but not exceeding in amount four weeks’ remuneration in respect of the employment from which he was dismissed calculated as aforesaid) as is just and equitable having regard to all the circumstances,
and the references in the foregoing paragraphs to an employer shall be construed, in a case where the ownership of the business of the employer changes after the *212 dismissal, as references to the person who, by virtue of the change, becomes entitled to such ownership.”
Deliberation
As the complainant is alleging constructive dismissal, the fact of dismissal is in dispute. Therefore, the onus of proof rests with the complainant to establish facts to prove that the actions of the respondent were such as to justify him in terminating his employment.
Section 1 of the 1977 Act, as amended, envisages two circumstances in which a resignation may be considered to be a “constructive dismissal”. They are where the employer’s conduct amounts to a repudiatory breach of the contract of employment such that the employee is “entitled” to resign, often referred to as the “contract test”. In Western Excavating (ECC) Ltd v Sharp [1978] Q.B. 761 this was said to require that the employer was guilty of conduct “which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract …”. The second circumstance, which can be relied upon either as an alternative or in combination with the contract test, is where the employer conducts his affairs in relation to the employee so unreasonably that the employee cannot be expected to put up with it. Usually, in constructive dismissal cases, as set out in Conway v Ulster Bank Limited UD474/1981 the complainant is required also to act reasonably by providing the employer with an opportunity to address whatever grievance they may have.
It is of note in the instant case that the complainant could not utilise the company’s grievance procedure to seek to rectify what was, in his view, an unjust outcome to a disciplinary process. The court notes in this regard the determination in Beglan v Scanomat Ireland Ltd UD688/2012 in which the complainant had no means of dealing internally with his grievance and felt that he had to resign and in which the Employment Appeals Tribunal found that the complainant had been constructively dismissed. Similar issues arose in Schonfeld v West Wood Club Clontarf Ltd UD1013/2013 with a similar outcome. While noting also the expressed willingness of the respondent to find another way to deal with the complainant’s grievance and to facilitate a re-establishment of a working relationship, the fact is that, in the circumstances of the instant case the requirement applied normally, as part of the “reasonableness” test, that the employer’s grievance procedure be utilised was not something that was available to the complainant. That, of itself, does not mean that the complainant was constructively dismissed. It does mean that if the complainant can show that his employer’s behaviour was unreasonable, the fact that the complainant did not, because he could not, utilise the grievance procedure cannot be a factor in the court’s consideration.
The measure of reasonableness was set out with clarity by Finnegan J. *213 in the case of Berber v Dunnes Stores Ltd [2009] IESC 10; [2009] E.L.R. 61 as: “[t]he conduct of the employer complained of must be unreasonable and without proper cause and its effect on the employee must be judged objectively, reasonably and sensibly in order to determine if it is such that the employee cannot be expected to put up with it”.
This is the measure against which the court must evaluate the case of the complainant. It is, undoubtedly, a high bar to be met.
In the instant case, the complainant was interviewed originally as a witness. Reading through the comments in the transcripts of the meetings, it is far from clear that the complainant was regarded as a witness. Suggestions of disciplinary processes and clear hints of potential dismissal are not normal behaviours towards witnesses and are more like what might be put to somebody being accused of wrongdoing, in which case the complainant would have been entitled to have allegations put to him in advance and to be afforded the right of representation.
There was then a five-month delay before this matter was broached again with the complainant and when it was raised again it was not raised to advise him that a disciplinary investigation was to be conducted into which he would be invited to input. Rather, the complainant’s status skipped straight from being a witness to being subject to a disciplinary process without what one witness described accurately as a “bridge” between the two in the form of a disciplinary investigation. It is not without reason that the guidelines on disciplinary processes provide for disciplinary investigations as set out in the Industrial Relations Act 1990 (Code of Practice on Grievance and Disciplinary Procedures) (Declaration) Order 2000 (S.I. No. 146 of 2000). The reasons are so that facts can be separated from suspicion and rumour and explanations can be offered by anybody who could, potentially, be facing a disciplinary process. The fact that the respondent did not undertake this exercise put the complainant immediately at a disadvantage in the subsequent disciplinary process. If the complainant had been dismissed as a result of this process, it might be expected that he would have argued an unfairness of procedure that was such to render unfair the outcome.
However, the complainant was not dismissed, he chose to resign. It is arguable if this procedural breach was at a level of unreasonableness such that a reasonable person would conclude that they had no option but to resign even if the questioning at the earlier meetings was inappropriate when directed at a witness.
The decision to suspend the complainant requires consideration. Included in such consideration is the absence of a disciplinary investigation. As was noted in Governor and Company of the Bank of Ireland v Reilly [2015] IEHC 241 at para.41, suspension “ought to be seen as a measure designed to facilitate *214 the proper conduct of the investigation”. It is most unusual for a worker to be suspended in the circumstances of the instant case. Clearly, there was no question that the decision fitted with any of the examples given in Governor and Company of the Bank of Ireland v Reilly [2015] IEHC 241 where suspension would normally be justified if:
“[41] … seen as necessary to prevent a repetition of the conduct complained of, interference with evidence or perhaps to protect persons at risk from such conduct. It may perhaps be necessary to protect the employer’s own business and reputation where the conduct in issue is known to those doing business with the employer.”
None of these could be applicable as the complainant was left working for five months after the interviews that, apparently, prompted the instigation of a disciplinary process against him.
The reason offered by the respondent to the effect that the complainant needed time to go through all the relevant documentation suggests a level of benevolence towards his needs that was not otherwise apparent throughout the events that led to his resignation. The fact that the complainant made clear his strong wish not to be suspended does not appear to have affected the judgment of the managing director. As was noted in Governor and Company of the Bank of Ireland v Reilly [2015] IEHC 241 suspension of an employee “can cause irreparable damage to his or her reputation”.
The court struggles to understand how it can be justified to suspend an employee on one stated basis while subsequently advising the person who conducted the later appeal that there was a second reason, which was never put to the complainant who, as a result, was not afforded the basic right of natural justice to be heard on the matter, prior to a decision being taken that had such potential to cause harm to him.
While an argument can be made that advising the rest of the workforce of the suspension of the complainant might have been better for him than allowing the rumour mill to shape the narrative, it illustrates the consequences of the suspension for his reputation.
It is arguable if any one of the clearly unfair procedural deficiencies to which the complainant was subject could, of itself, give rise to a legitimate claim for a constructive dismissal. The court is clear, however, that the combined effect of them all would lead most reasonable people to the belief that the employer would like to have been shot of the employee. It is to the respondent’s credit that they engaged outside decision-makers for the disciplinary hearings and the appeal. In the circumstances, the court is led to the conclusion that this level of independence is what prevented a decision to dismiss and that the complainant was entitled to draw the logical conclusion that he was not wanted. It could be a source of interesting academic debate as to whether this situation went *215 to the root of the employer/employee contract and, thereby, gave grounds for constructive dismissal on the “contract” test. It is not necessary for the court to enter this debate in the instant case. The court is clear that the behaviour of the respondent was so unreasonable that it was reasonable for the complainant to terminate his contract. The court determines, therefore, that the complainant was constructively dismissed.
The court is of the view that compensation is the appropriate remedy in this case. Unfortunately, the court received little help in assessing the level of compensation that should be awarded. Information was provided that the complainant had registered with three employment websites, that he had been unemployed for a significant period, (though the court was not provided with the sort of evidence it would expect of letters of application to employers, etc.), that the complainant now worked two to three days per week and that he continued to seek full-time employment. No useful information was provided quantifying the actual income losses. In this very unsatisfactory situation, the court has to proceed with caution. Having weighed such information as was provided, the court determines that compensation of €15,000 should be awarded.
Determination
The decision of the AO is overturned.
Leanne McGrath v JD Wetherspoon Plc t/a The Linen Weaver
ADJ-00031597
Workplace Relations Commission
18 July 2022
[2023] 34 E.L.R. 45
Procedure
In accordance with s.8 of the Unfair Dismissals Acts 1977-2015, following the referral of the complaint to me by the Director General, I inquired into the complaint and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint.
Background
This matter was heard by way of remote hearing pursuant to the Civil Law and Criminal Law (Miscellaneous Provisions) Act 2020 and S.I. No. 359 of 2020, which designates the Workplace Relations Commission as a body empowered to hold remote hearings.
On 15 January 2021, the complainant, a kitchen manager, submitted a complaint of constructive dismissal against the respondent, who operates within the hospitality industry. The claim was denied, and dismissal was disputed.
Both parties filed helpful written submissions which provided context and background for the case. The complainant was represented by Denise Mulcahy BL instructed by Douglas Law and the respondent by Kevin Bell BL instructed *47 by Kennedys. The respondent business is registered in the United Kingdom.
Summary of complainant’s case
The complainant was employed from 1 January 2015 across a number of roles until 20 December 2020. She worked full time in return for a salary of €3,330 per month.
The précis submitted by means of the complaint form reflected that the complainant had sustained psychological injuries as a result of a dangerous and stressful working environment causing the complainant “no option, but to leave.” The complainant had not found new work.
In claiming constructive dismissal, counsel for the complainant outlined that she had worked for the respondent firstly in Dublin as a kitchen associate at two locations before her promotion to kitchen manager. She left that position to take work at a supermarket before commencing at the respondent’s Cork premises in April 2018 as a bar manager.
Counsel submitted that the complainant faced daily difficulties in this role through “inappropriate lack of security staff over the 24-hour period, presence of Garda¡, racist and abusive comments from patrons in addition to abusive and aggressive intoxicated customers.” The complainant exhibited a “Blue Bag” incident record log during her tenure.
Counsel contended that the complainant had raised her concerns routinely with the respondent. She said that the complainant was not trained in management of violence and aggression. She was a key holder at the business.
On 1 July 2019, the complainant experienced verbal abuse from an intoxicated customer when she requested he leave the premises. On 9 August 2019, the complainant witnessed a toilet in disarray with excrement on two patrons’ departure. There was no security staff available. There were other challenging incidents.
The complainant relocated to work in the kitchen as kitchen manager and this became her main role from January 2020.
On 1 March 2020, the complainant was called to assist in a further violent incident, where an on-duty manager was stabbed by a customer which traumatised the complainant. There was no security presence. The complainant reported the incident and received a rude response from the manager, Mr A. She was provided with a counsellor telephone number in the UK. She was unable to return to work.
The complainant was forced to leave her position as it had become untenable for her. Her mental health was affected and she did not perceive that there was any prospect of real improvement, where complaints made had “remained largely unheeded and/or inadequately addressed.”
It was the complainant’s case that since 2018, she had raised security issues on a weekly basis to Mr B and Mr C at the business. As area managers, they were on full notice of the unsafe work environment.
*48
Counsel argued that the respondent should not be permitted to stipulate a grievance invocation when set against the complainant’s reality of repeated notification of personal concerns for her safety at work set against open drug use, intoxication and Garda intervention.
Counsel contended that the complainant was entitled to terminate her employment as the respondent’s actions demonstrated that they were no longer intent on being bound by the essential terms of the contract on maintenance of security and personal safety.
Counsel referred to the cases of Brennan v Dark Side Bars Ltd Labour Court Determination UDD 2129, 19 April 2021, Blundell v CPL Healthcare Labour Court Determination UDD 1616, 27 July 2016, Berber v Dunnes Stores[2009] E.L.R. 61 and An Employer v A Worker[2005] E.L.R. 132 when she stated that the complainant had made extensive efforts to mitigate her difficult work situation to no avail. She could not reasonably have had faith in the company HR processes at that juncture. The complainant was entitled to leave.
At hearing, counsel for the complainant echoed the background to the case. She stressed that security was only available at the respondent business during Thursdays, Fridays and Saturdays. She described the details surrounding the violent episode of March 2020 caused by a gin glass, where blood was “all over the floor.” This was later clarified in evidence by the complainant as “on her apron.” She described the lingering effect that this violence had on the complainant. She accepted the offer of counselling but she withdrew and hid in the kitchen. She said that the respondent’s efforts were “all too late.”
Counsel confirmed that a personal injuries claim was live from September 2020. The complainant’s partner was the bar manager, but he was not there from August to October 2020. Counsel contended that the resolution of the problematic issues was not within his remit at any rate as Mr A was in charge. She confirmed that the partner also had a case before the Workplace Relations Commission, which was part-heard.
Counsel outlined that the business was closed through the pandemic from March to August 2020. The business re-opened from 24 August 2020 to 25 October 2020. Another closure followed.
The complainant engaged with the respondent, but she was wary as “nothing changed.” She lost faith.
Evidence of the complainant
The complainant outlined that she had become front of house manager in 2018, where opening hours were 10.30 a.m. Monday to Saturday and 12.30 p.m. on Sundays. It was a very busy working atmosphere, encompassing two bars and three floors with a typical four/five staff cohort. There was no security presence outside of Thursday to Saturday when the security presence stood at one or two, without replacement. One manager was present up to 6 p.m.
*49
The pub hosted a cross-section of customers with drugs and violent incidents which prompted Garda intervention
The complainant gave evidence of an incident of service refusal in July 2019 which prompted the attendance of three Garda¡ to the premises and a filed Incident/Acura report. She recalled that this incident did not prompt Mr A to raise a security alert. The pub manager was aware of the event.
A further event followed in August 2019 where two female customers became violent in the toilet area. The complainant said that she was affronted by their screaming when they were asked to leave. There were immediate hygiene issues in their wake. There was no security, and the incident was logged on the Acura system. A month later, she witnessed another aggressive and violent presentation.
The complainant moved to the kitchen in late 2019 and became leader to 14 staff.
In March 2020, while engaged in staff interviews, Mr X refused service to a group and asked them to leave. He was stabbed in response. The complainant stated that she initiated first aid and managed the incident by calling Garda¡ and an ambulance. Armed Garda¡ attended within five minutes. She reported the incident and was instructed to cease trading by a senior manager. She recalled that blood was on her apron, but not on the floor. She described the response received from Mr A as “aggressive and rude.” There was no security presence. By 8 a.m. the next morning, Mr A was in the pub. Security was installed for a two-week period and was overtaken by lockdown.
The complainant described her response as distraught and she confirmed that she took two weeks (one holiday) off with pay and availed of three counselling sessions, keeping one in reserve. Mr A offered her the support number, and she did not have further contact with him during lockdown.
The complainant described that she was a key holder without training in the role and this presented as a concern when working late at night. She stated that she was not trained in managing challenging behaviour from customers.
The complainant confirmed that the business re-opened on 24 August. She described feeling very nervous and not sleeping. She said she had flashbacks and found that she was avoiding staff. She said her mental health was affected. Concurrent with that period, she was a witness in a grievance taken against her partner.
She requested the presence of a locum pub manager and this was provided for a two-week period until another lockdown followed. By then, she had lost trust in Mr A as no training was put in place and security started at 6 p.m. rather than 8 p.m. on Thursday-Sunday. The respondent had suggested the presence of two floor staff as being cheaper than the €19 per hour for external security.
The complainant recalled the 30 November Zoom call with Mr A. She had already sought legal advice. She accepted that she had confirmed that she was happy to return to work, she explained that she needed the money and she denied *50 that she was cheerful. She was not reassured by the offer of personal alarms.
When asked by counsel why she had not confronted Mr A, she said that she had lost trust as she had observed a previous episode on how he had treated the pub manager. She stressed that she had tried to deal with issues on multiple occasions but was unsuccessful.
She confirmed that hers was an involuntary resignation as her safety concerns had not been addressed, causing a loss in trust and lack of support. She saw no merit in the offer of transfer and felt that she would only be “pushed on” to Dublin.
During cross-examination, the complainant confirmed her previous roles at the business in addition to a historical role as a gym instructor. Counsel posed the question of whether the complainant accepted that difficult customers and confrontation were unavoidable in a pub setting. The complainant countered this by stating that she should have had support and training and she would have liked mobile security, such as two bouncers during opening hours.
In addressing the company response to the “March attack on Mr Z,” the complainant confirmed that she was paid for two weeks, one of which was annual leave. She confirmed that she received counselling. While security levels were increased, she replied that this did not cover Monday to Wednesday trading. The complainant accepted that the management team were laid off from mid-March 2020. The complainant confirmed that her partner was involved in an issue of racial discrimination.
The complainant confirmed that she had compiled a health check list on the 11 September Zoom call. She accepted that Mr A had agreed to follow up on further counselling. She replied that there was no follow up during October.
The complainant said that trust had gone by 11 September 2020. She had asked for a training day then. She accepted that the holding manager was appointed before a further lay off from the end of October 2020 until the business was due to re-open in December.
She outlined that by the 30 November meeting, she did not know what the meeting was about. She had specified that two security staff were required and noted that Mr A was not committed to that. Some training had occurred for managers, but not for all. No training had been directed at key holders. She felt unsafe at work. Staff needed help and were without a manager.
The complainant stated that she had tried to resolve issues, but did not trust Mr A. She referred to her previous dissatisfaction regarding a travel claim in the earlier Dublin posting which involved Mr A.
The complainant accepted that her partner had been disciplined at the business and that he had resigned on 23 November 2020 but countered that “that was nothing to do with her.” He had been absent from the business from 24 August-25 October.
The complainant confirmed that she had invoked the first step of the grievance procedure. She said that she had not emailed or called Mr A in relation to the *51 pub issues.
She accepted that she had received a “cooling off “letter. She agreed that she had been offered a rota change. She did not recall being removed from key holder duties.
In response to the question on whether she had paused to reconsider her position, the complainant responded by saying that trust was gone and there was no support.
In respect of mitigation of loss, the complainant said that she had undertaken a course in January 2021. She had been 100 per cent fit to work and was commencing new work in a new jurisdiction the week after the hearing, tenure indefinite, in Hungary. The complainant exhibited some job applications.
By way of clarification, the complainant confirmed that she did not take sick leave at the business outside of two weeks post the March incident. She was not paid extra to be a key holder.
The complainant confirmed that staffing levels had altered following the July 2019 incident. She said that limited staffing was allowed. The locum female manager had not returned to the business post the second lockdown.
The complainant was unaware of what happened to the perpetrators of the March attack. She confirmed that the interviews were for kitchen and front of house.
She clarified that she had sought training in dealing with drunk customers.
The complainant confirmed that she received the minutes of 30 November meeting and signed them. She clarified that “no trust” was her reason for leaving.
She had applied for the course undertaken in January 2021. She confirmed that she had wanted to sort things out but had lost trust and the personal injuries action had followed.
She explained that she was on honeymoon in the aftermath of leaving work.
In redirect, the complainant confirmed her age on commencing work and that the March attack had been channelled through the criminal court.
Evidence of Mr B, the complainant’s partner
Mr B became bar manager in April 2018. The complainant reported to him. He submitted that he was curtailed as pub manager in terms of altering security, recognising this as Mr A’s territory. He referred to an unexhibited email submitted by the complainant.
He submitted that regular talks had occurred on “Blue Bag.”
He confirmed that the complainant had left employment one month after he left. She deputised in his absence. He dismissed the March training as inadequate. He said that he was not trained.
Mr B outlined the hierarchical structure at the business: Mr A, area manager, Mr B, pub manager 2018-November 2020, team lead, shift lead.
He submitted that two people placed on door duty was insufficient.
*52
In cross-examination, he confirmed that the complainant had not escalated any specific complaints post the March attack. By way of clarification, Mr B was uncertain whether his name was set out as a figure of authority on the safety statement.
He was unclear on the precision of timelines of occurrences. He clarified that he had not suggested any specific remedial action.
In closing, counsel for the complainant submitted that the complainant was a young age in 2018 and had received negligible training in the role, while the respondent was not prepared to address training.
The March attack followed in 2020. Additional security could have been considered. The complainant did not receive performance appraisal and the respondent’s response to the March attack was poor and devoid of a training component.
The complainant was not considered for refresher training and it was not featured in either interaction of 11 September or 30 November.
Counsel contended that the company was a big organisation and a Plc. She argued that the complainant’s concerns were not dealt with. She summarised Mr A’s evidence as a tick the box approach and “going through the motions.” This was an unreasonable approach.
The complainant was compelled to resume her position for financial reasons. Hers was not a voluntary resignation. She was in a poor state of mind and had no confidence or trust that things would change.
A table of loss and mitigation recorded a €53,023 gross loss from 14 December 2020 to date of hearing (69 weeks). The course undertaken by the complainant in January 2021 was 16 weeks’ duration.
Summary of respondent’s case
The respondent operates within the hospitality sector. The circumstances of this case centred on a pub/restaurant in Cork.
The respondent disputed that a dismissal occurred as the complainant had resigned voluntarily. The respondent expressed a dissatisfaction with the lack of particulars on what motivated the resignation
The letter of resignation dated 7 December 2020 reflected:
“Please accept my resignation from the position of kitchen manager at X working my two weeks’ notice. My last working day will be 20 December 2020. I wish the team all the best in the future.”
Counsel for the respondent submitted that the violent episode of 1 March 2020 was witnessed by the complainant but managed supportively by the respondent. The complainant availed of a week’s holiday and an extended period of sick leave for which she received payment. She was also provided with 12 weeks *53 of counselling.
The complainant returned to work after the first pandemic-related government restrictions between 24 August 2020 and 25 October 2020 without incident.
The respondent held a back to work meeting with the complainant prior to the December re-opening and minutes were exhibited. The complainant informed this meeting that she was happy to return to work. She requested a 10 p.m. finish time as the dispersing of patrons late at night made her feel unsafe. This was agreed.
Counsel contended that the respondent had actively engaged in a systems review of personal safety in the complainant’s case. She identified the “space from the kitchen to the office” as a problem as this was the site of the March attack.
The complainant requested more training for staff and an enhanced security presence on the entrance. The respondent assured her that plans were in hand to address these points and the complainant did not request anything further but had added that Cork was “not a safe place to work.” The complainant did not seek any further counselling.
Counsel submitted that Mr A had considered the complainant’s statement on her safety concerns in Cork and enquired whether the complainant wished to consider a transfer. The complainant agreed to consider it and Mr A told her he would be available for follow up the following Wednesday. The complainant resumed work the next day and the next communication received by Mr A was the complainant’s resignation.
Counsel submitted that the respondent had behaved reasonably towards the complainant. She had not raised an internal complaint or a grievance and had resigned precipitously without recourse to the respondent policies on stress management and grievance.
It was the respondent’s case that the respondent had acted responsibly in the face of the complainant’s stated concerns.
At hearing, counsel outlined that the respondent had presided over and delivered on practicable security measures. He contended that the complainant’s requests for support in the workplace were met.
By its very nature, the pub was busy and risks were assessed.
Counsel concluded that in reliance on Conway v Ulster Bank Employment Appeals Tribunal Determination UD 474/1981, the complainant had not exhausted the company internal procedures. She had not actioned the grievance procedure. She was obliged to exhaust both the formal and informal routes in resolution.
The respondent relied on Byrne v Horwarth Bastow Charleston Wealth Management Ltd Employment Appeals Tribunal Determination UD 67/2014, Brennan v Dark Side Bars Ltd Labour Court Determination UDD 2129, 19 April 2021, Blundell v CPL Healthcare Labour Court Determination UDD 1616, 27 July 2016, in arguing that the complainant had not been constructively dismissed and there was no objective justification for her resignation.
*54
Evidence of Mr A, area manager
Mr A was with the respondent business for 15 years. He commenced as an associate in the UK and climbed the promotional ladder through pub manager role to now area manager, overseeing a number of locations.
Mr A gave an outline of the security profile in Cork, which comprised CCTV, panic alarm, bodycam, risk assessment and Standard Operation Protocol (SOP).
He submitted that both he and Mr B had collaborated on a risk assessment of the pub in November 2019 and security was focussed on Thursdays, Fridays, and Saturdays, with scope for upward adjustment on specific occasions such as the jazz festival.
He recalled that there had been 12 incidents over the years 2018, 2019 and 2020 which was not unusual.
In response to the March 2020 attack, he denied that he had chastised the complainant on that night. He had been on a day off and Mr Z had contacted him on his personal mobile device. He recalled phoning the complainant offering limited support.
He recalled visiting Cork on the Monday afternoon afterwards and both he and Mr B undertook a security risk assessment, where door staff were increased and customer training organised. The training was called “don’t do drunk” and was training to avoid escalation of a “drunk presentation.”
Mr A confirmed that he had never refused to undertake security measures. Mr B had not requested any specific interventions. The complainant did not request full security.
He confirmed the range of supports offered to the complainant in the immediate aftermath of the “March attack” before Covid-related lay offs took over.
He confirmed that a locum manager had been redeployed from Dublin between 1 October and 10 October 2020. No addition to that was sought.
He acknowledged that the complainant was still suffering but was clear that she had not requested security in her wellbeing check list on 11 September or at her back to work meeting on 30 November.
Mr B had told him that the complainant’s sleep was affected.
Mr A acknowledged that he too had been on lay off during the pandemic and it had not been possible to follow up on the complainant’s wellbeing before 11 September. He recalled that the complainant raised shift pattern and her concerns on leaving the pub at night and she was offered an early 10 p.m. finish.
He submitted that door staff had been increased to cover seven days post-March. There were no plans to remove this to date.
Mr A said that the complainant did not make further suggestions. He checked in with her on 3 December and the shift change was confirmed. He said he offered support and encouraged the complainant to “make us aware of what we can do.”
He was handed the letter of resignation personally by the complainant. He had *55 not anticipated it and it was low on content. He sought the complainant’s input but was met by “reduced dialogue.” The complainant carried on in her duties.
He submitted that the “cooling off” letter dated 9 December was formulated by past discussions he had had with the complainant. He had valued her as an employee. He did not receive a response to this.
Mr A concluded by commenting that the grievance procedure was universally available to all employees but that the complainant had not actioned this procedure.
During cross-examination, he responded to the complainant’s question on the occurrences of violence and aggression at the business as “being nothing out of the norm.”
He said that he was not made aware of a review of security in April 2018. He confirmed that Mr B had not made him aware of concerns. He said he had not complained. He outlined that he had regular conversations on maintenance and staffing issues, but security issues were not flagged.
He recalled that during monthly Garda liaison meetings that the Garda¡ as a body had not earmarked the Cork pub as a particular cause for concern. The company had no major concerns regarding Cork from 2019.
Mr A refuted counsel’s contention that it was incredible that he had not been made aware of the concerns regarding security and the 2019 violent occurrences
Counsel put to Mr A the complexity of the layout of the business with space for up to 400 customers, three floors and a beer garden. Mr A reaffirmed the two doorman presence and 6/7 p.m. start Thursday to Saturday inclusive without a need at that time for upward alignment.
He attributed responsibility for security to Mr B, who did not make specific requests. He affirmed that Mr B had delegated authority to bring in a bouncer, but counsel disagreed.
Mr A accepted that the 2019 incidents resulted in further contact with staff on incidents and accidents. He re-affirmed that security detail was “active security” and countered that the complainant had not raised the topic of her security.
He denied that he attempted to reduce the cost of security by relying on cheaper security. Mr B responded by stating that the management of violence and aggression was 99 per cent preventative in terms of refusing access.
Mr A contended that the complainant could have raised a grievance directly with her line manager.
He recalled that March 2020 training had consisted of role play and had lasted 90 minutes. The complainant had not attended due to illness and lockdown followed.
He confirmed that the statement of claim for the complainant’s personal injuries claim had gone to the company HQ.
He said that it was 30 November when he became aware of the complainant’s concerns. His main concern for the complainant was that there was limited *56 reason for her to be front of house. He rejected counsel’s contention that he was not genuine in this.
He accepted that emails had been submitted in January and March 2020, but these were not specific to the complainant and no specific recourse had been sought.
After the March attack, security had been placed over seven days.
Mr A contended that the wellbeing assessment was more than a mere tick the box exercise. He argued that there was ample opportunity for the complainant to raise issues via personnel or through her line manager.
Counsel concluded that the complainant did not receive training post the March attack and was entirely justified in leaving employment. Mr A refuted this and confirmed that there had been numerous levels of support and the complainant had not alerted him to door staffing patterns.
In clarification, Mr A confirmed that the personnel manager had engaged in debriefing with staff in attendance. He told the hearing that he was aware that the complainant had anxiety and some PTSD.
Appraisals were the territory of the line manager. He outlined the fora available for discussion with him as weekly visits, emails, weekly “Blue Bag” meetings, and grievance procedure.
Mr A submitted that he had no idea why the complainant resigned. He recalled that she was emotionless on handing him her letter of resignation.
Evidence of Mr Z, victim of March attack and shift manager
Mr Z outlined that he still works at the business. He commenced as a glass collector there in April 2018. He pointed to security improvements at the pub such as portable alarms.
He submitted that he believed he had received support post the March attack through Mr B’s contacts and receiving full pay. He was debriefed by Mr B on the night and by Mr A, when he was released from hospital next day.
He recalled that a risk assessment was undertaken immediately after the event and training followed in customer management. Door staff were hired to work seven days a week, which continued until February 2022.
Mr Z said that he had not picked up on any complaints from the complainant. He thought that Mr B’s departure would prompt her departure.
During cross-examination, Mr Z contended that the respondent had responded responsibly to the violent incident. He said that the criminal case had been postponed in January 2021.
He had not been working the day of the pepper spray incident in 2019.
He stated that the complainant was genuine in response to counsel.
He added that security was not realistic from 10.30 a.m. as it is impossible to predict or pinpoint an occurrence of violence. Business resumed in August on seven day cover from 6 p.m. to closing. This was communicated through the *57 WhatsApp group.
He said that he had not completed the March training as he had already completed it.
On clarification, he confirmed that the pub manager was listed on the group WhatsApp. Staff meetings were rarely held by the pub manager. Bodycams were introduced during 2020.
In closing, counsel for the respondent contended that the company had not refused a single request made by the complainant.
They acknowledged that she had carried concerns which were understandable post the stabbing but the company had responded reasonably by appointing a locum manager, providing customer management training provision and enhanced security presence. The business was closed for a number of months during 2020 due to the pandemic until it reopened both in August and December 2020.
Counsel concluded that the complainant had not attained the burden required of her in the case. The resignation was unreasonable as she had not utilised or exhausted the internal process (Curry v Tech Mahindra Business Services Ltd Labour Court Determination UDD 2124, 14 April 2021).
Findings and conclusions
The case for decision is a claim for constructive dismissal, which has been denied by the respondent in the case. In reaching my decision, I have considered both extensive written submissions, the oral evidence adduced in addition to closing remarks from both counsel.
It is an important chronological backdrop in the case that a personal injuries case was lodged by the complainant in September 2020. This was live at the moment of her resignation on 7 December 2020. I will return to this aspect of the case later.
My jurisdiction in the case is provided in s.1 of the Unfair Dismissals Act 1977 (“the 1977 Act”):
“b) the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer,”
In practical terms, this can amount to a high bar for the complainant to prove.
In this case, the burden of proof rests with the complainant to demonstrate that her resignation was involuntary. This means that if the employer is guilty of conduct which is a significant breach going to the root of the contract of *58 employment or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat herself as discharged from any further performance. (Western Excavating (E.C.C.) Ltd v Sharp[1978] I.C.R. 221 at 226).
In Berber v Dunnes Stores, a store manager claimed that his Crohn’s disease was exacerbated by the actions of his employer. The Supreme Court considered whether there had been a breach of the implied terms of mutual trust and confidence in contract of employment. The court held that (1) the test is objective; (2) both parties’ conduct must be considered; (3) the cumulative effect must be looked at; and (4) the conduct of the employer must be unreasonable and without proper cause, the effect on the employee judged objectively, reasonably, sensibly to ascertain whether the “employee cannot be expected to put up with it.”
There is implied in a contract of employment a mutual obligation that neither the employer nor employee will conduct themselves in a way likely to damage the relationship of confidence and trust between them. This is an interesting case as Finnegan J. went on to comment in the context of the law regarding the corresponding personal injuries case.
Stress is merely a mechanism whereby harm may be caused and it is necessary to distinguish between signs of stress and signs of impending harm to health. Frequent or prolonged absences from work which are uncharacteristic for the person concerned may make harm to health foreseeable. There must be good reason to think that the underlying cause is stress generated by the work situation rather than other factors. Where an employee is certified as fit for work by the medical advisor the employer will usually be entitled to take that at face value unless there is a good reason for him to think to the contrary. As to the duty of care, the employer’s duty is to take reasonable care and if the risk of harm to health is foreseeable the employer must act reasonably.
I have reflected on both parties’ evidence in this case. I found that the complainant’s submissions regarding provision of training strayed at times into the territory of a personal injuries case. My role in this case is to consider the facts surrounding a resignation from employment and to decide which I consider this to be a voluntary or involuntary action.
At the outset, I accept that working in a pub can present as a challenging job. I accept that customers or disappointed customers post high levels of alcohol or even drugs can present as a direct challenge to the employees attempts to run a “safe pub and workplace.”
The complainant was employed for two and a half years at this location across two roles (bar manager and kitchen manager) by the time of her resignation on 7 December 2020. Both parties accepted that she had a span of earlier employment at the Dublin pubs.
Counsel for the complainant requested that I consider the complainant’s young age on joining the industry, first in Dublin and from 2018 in Cork. I have *59 considered this and find that the complainant presented as a self-assured witness, who was familiar with the business and was competent in her reportage of “Blue Bag” incidents. It was also clear to me that her swift and competent management of the March attack may well have contributed to Mr Z’s speedy recovery.
I found the complainant to be comfortable in her role of kitchen manager outside of some residual trauma regarding the March attack and pressure from her 14 subordinates.
I found it unusual that the complainant did not mention that she had participated in debriefing in the aftermath of the March attack.
She confirmed that she had benefitted from the respondent-sponsored counselling. However, the complainant contended that she was affronted by Mr A’s dialogue with her on 1 March 2020. Mr A gave a very cogent account of this conversation as he said that he had been on a day off and was contacted by a colleague, which prompted a next day site visit.
I found Mr A’s approach to this case very measured. He was clearly proud of his knowledge of how the business operated and that he had made a personal sequential career progression to area manager. To me, at least, he gave the impression of caring about the complainant’s welfare. I found strong evidence of this in the 9 December “cooling off” letter where he told the hearing that he had inserted an amalgam of what they had discussed in the letter aimed at securing a recant from the complainant.
Integrity is often referred to as “doing the right thing when nobody is looking.” I listened to Mr A’s account of how he managed the aftermath of the March attack and my attention was drawn to his submitted request for payment for the complainant.
“…. The local guards are currently investigating the incident and myself and the personnel team are supporting Leanne and the pub team as well as getting LTC involved. There is a strong possibility that Leanne may require additional support and time off.”
I have interpreted this action for continued payment as an appropriate step in staff support.
What happened next was outside both the complainant’s and Mr A’s control. The business was closed due to government restrictions within two weeks and stayed closed for the following four and a half months to August 2020.
Both parties accept that, while the complainant continued with counselling, keeping one session in reserve, Mr A was on lay off and not available to the complainant.
It is of cardinal importance for me to reflect that the complainant’s partner Mr B, the appointed bar manager, was absent from the business from August to October 2020. Both parties reflect that a racial discrimination case was ongoing *60 at the business and the complainant was clear that she was a witness in this case, which concluded with disciplinary action against Mr B, who left the business at the end of November 2020 and before the business re-opened for business on 4 December.
I found Mr B’s evidence to be vague and I was unable to get an understanding of his sense of his own role of in-house responsibility for security. I was concerned that the complainant may have become an unwitting oracle for his dissatisfaction with the company. I say this as I found her very strident on the topic of universal security at the business, yet her contracted role was kitchen, and not bar, manager.
I found the complainant’s reaction to the respondent’s counsel to be very defensive as he asked questions on this occurrence. I found that she sought to distance herself from the topic. I formed the view that this topic was a veritable sub-plot in the case and a highly likely source of the complainant’s plain hostility towards Mr A.
It is common case that Mr A was the area manager during this time and I found that the complainant’s evidence reflected a projected anger against him. She attributed this to an earlier event whilst employed in Dublin however I identified a closer proximity in time.
This meant that the complainant resumed work in August and worked continuously until the second lockdown in October 2020. During this time, the complainant engaged in a “wellbeing check list” on Zoom with Mr A.
The form reflected:
“This form should be completed when you are told or could reasonably be expected to know that an employee may be suffering from a defined medical condition/ disability, which may include physical and mental health issues”
The complainant submitted that this was a “tick the box” event.
I found that the form captured the complainant’s health status at six-month interval post-March attack. It recorded “some anxiety” “slowly adapting to being back at work” and anxiety when front of house. She identified that her confidence “had been impacted and this will take time to rebuild.” A further visit to the GP was planned for that week. She was not taking any medication at that time. The complainant described some pressure from her work team in the kitchen. A follow up meeting was planned for six weeks out.
The next engagement occurred on 30 November 2020 and was chaired by HR and attended by Mr A and the complainant. The meeting reflected the first in time personal injuries case.
Having considered both parties’ evidence in the case and the back up exhibited minutes of this meeting, I found that the meeting reflected a supportive management approach to the complainant’s work setting through an alteration of finish times, an encouragement on personal alarms and a concerted effort to *61 align the complainant to the kitchen area as she was wary of the front of house reminder of the trauma scene from March 2020.
I found that the minutes reflect a positive “step by step” engagement by the parties which consolidated into an action plan inclusive of an exploration of a transfer of employment.
The complainant agreed to resume work without preconditions outside a delayed start and earlier finish time to 10 p.m. The minutes reflect a planned follow up the following Wednesday.
The case takes on an unusual turn at this point as seven days later, the complainant handed her resignation to Mr A, quoted above. It was a plainly worded document, without reasons and with a message of good luck to the staff. For me, it read like a straightforward voluntary resignation.
However, I have been asked to recognise this as an involuntary action as the complainant could not simply continue in the business. This point is refuted by the respondent who depicted a “work in progress” backdrop to the complainant’s employment.
The complainant submitted that she had hoped for an internal resolution to her issues but was overtaken by legal advice. She worked for two weeks post-submission of notice, without incident and without responding to the 9 December letter from Mr A for the business.
I can accept that the sequence of manifestation of challenging customers and their drug and alcohol habits did take its toll on the complainant. She relocated from front of house to the kitchen but feared front of house exposure and was troubled by the demands of her staff.
The complainant accepts that security was increased at the business in the aftermath of the March attack. I was taken by Mr Z’s direct evidence when he pitched management of violence and aggression as largely preventative. I was also taken by his frank disclosure that he guessed that the complainant would follow Mr B in resignation.
The complainant told me that she had considered measures short of dismissal, e.g. sick leave but she had lost trust in the business. For me, this stands as a stark antithesis to her engagement on 30 November where a reasonable analysis of the evidence and the recorded minutes was that of a bridge building exercise to “return to some peace of mind” post-March 2020 attack.
I must also observe that by 30 November, the complainant had not submitted any additional medical advice from her October 2020 visit.
The complainant has not tendered any expert medical evidence of PTSD or anxiety live at the moment of her resignation in this case. Furthermore, when asked to clarify her capacity to work in the aftermath of termination, she confirmed that she was 100 per cent fit to find work.
I realise that the complainant and Mr B married also during this aftermath period and now reside and work in Hungary.
*62
In assessing whether the termination was involuntary, I must consider the steps taken by the parties.
I have found that the complainant’s recovery post-March 2020 was directly impacted by the pandemic lockdowns. However, while the business was open and trading, I found that the respondent adopted a supportive approach to the complainant through the measures highlighted above. They were prepared to build on that through 2021 as reflected in Mr A’s evidence and the “cooling off” letter.
I am troubled by the complainant’s sudden resignation; I have not found a “last straw” moment. I have not found an argument or a reported or diagnosed exacerbation of a medical condition. I have not identified periods of absence from work or any other signs of pressure.
I have, instead, found insufficient evidence of the complainant’s own reports that security and training fell below an acceptable standard for her resulting in a loss of confidence in the company.
She did not stay back to test that theory through company procedures. The respondent had a visible grievance procedure, a relationship at work policy and a mental health policy. I have not identified that any of these suite of tailored policies were actioned.
I appreciate that that might come across as a hard-line approach. However, the Employment Appeals Tribunal has in the past considered a climate of interpersonal conflict where a grievance procedure was not known by the complainant when it held in Keane v Western Health Board UD 940/88 in determining that the claimant had been constructively dismissed, that the claimant had genuinely believed that the difficulties and stress she was experiencing had left her with no alternative but to resign. The Tribunal found that the claimant’s resignation could not be deemed a fully informed decision to terminate her contract of employment, as it was tainted by the claimant’s confused state of mind at the time, coupled with her obvious lack of knowledge of the grievance procedure. It noted that as soon as the claimant had had the benefit of informed advice as to the alternative remedies open to her, she had conveyed to the respondent notice of her desire to revoke her resignation. Regarding the respondent’s policy to never reconsider an employee’s resignation, the EAT found that this was unreasonable. In that case, the complainant was refused an opportunity in the cold light of day to recant her resignation. The Employment Appeals Tribunal found this unreasonable.
I must express a dissatisfaction at the complainant’s failure to respond or engage with the cooling off letter. I found it fairly worded and accommodating. I found it unreasonable that the complainant did not respond to this and cannot concur that the loss of trust was at its very height at that moment which the complainant said militated against a response.
The respondent has built a large part of their arguments on a failure by the complainant to utilise informal and formal procedures and has relied on Conway in that regard. Conway reflected a request to change a work pattern and must be *63 distinguished in the instant case as the request for a change in work pattern was acceded to by the respondent.
My attention was drawn to the very insightful case of An Employer v A Worker. Captured by Tara Murphy BL in “’That’s it, I quit!’: A Review of Significant Irish Case Law on Disputed Resignations” (2022) 19(1) I.E.L.J. 4, when she said:
“The Labour Court indicated that it had attached significance to the respondent’s decision to accept the complainant’s resignation there and then. In evidence, the respondent had admitted that the complainant’s resignation had had the appearance of an impulsive or irrational act. They had known the nature of the complainant’s illness and of his emotional vulnerability. In the Labour Court’s view, a reasonable employer would have paused before accepting a resignation in those circumstances and might have contacted the employee later to ascertain the reason for the resignation or to provide an opportunity for the employee to recant.”
I have found that the respondent behaved reasonably in response to the complainant’s notice to resign in the instant case. In An Employer v A Worker, the Labour Court forgave the omission to activate the grievance procedure in a case of discriminatory dismissal. There are a number of factors which, in the exceptional circumstances of this case, excuse the complainant’s failure to formally complain to the respondent before resigning. First, the respondent did not have a grievance procedure in place. Secondly, the offending conduct was perpetrated by the principals of the respondent who knew or ought to have known what its likely impact would be on the complainant having regard to his temperament and mental fortitude. Thirdly, the complainant’s condition was such as to require him to avoid confrontational or stressful situations and this was known or ought to have been known to the respondent. In that case, the respondent did not host a grievance procedure. However, the respondent was in possession of medical diagnosis and reports in the case.
In the instant case, the employment was well-supported by conflict resolution procedures across a range of headings. In her role of manager, the complainant was aware of this. I was struck by the evidence from Mr A that the complainant’s demeanour on submitting her resignation was “emotionless.” This suggests to me that she was at peace with her decision.
I have not identified offending conduct from the respondent. Instead, I found that the respondent was in the process of taking appropriate steps to normalise the complainant’s employment post the March 2020 attack. The complainant had not placed the respondent on notice of a diagnosed medical condition at the time of her resignation, despite recent GP engagement.
In all the circumstances of the case, I find that the complainant made a conscious decision to resign her position which was on the balance of probabilities tailored as an act of solidarity with her partner, who left following disciplinary action some four weeks before.
I have found that the complainant resigned on a voluntary basis without giving the respondent time and space to conclude the supportive measures commenced from 2019 onwards in her case.
The complainant was not unfairly dismissed.
Decision
Section 8 of the Unfair Dismissals Acts 1977-2015 requires that I make a decision in relation to the unfair dismissal claim consisting of a grant of redress in accordance with s.7 of the 1977 Act.
I have found that the complainant has not attained the high burden of proof for constructive dismissal.
The complainant was not unfairly dismissed.
Connie May v Moog Ltd
UD805/2000
Employment Appeals Tribunal
1 August 2001
[2002] 13 E.L.R. 261
Claimant’s case
The claimant told the Tribunal that she began working for the respondent in August 1997. She worked in assembly, inserting components into circuit boards. She received some training and was shown a video but mostly picked up the work by sitting next to someone with experience. There was a lot of preparatory work with the circuit boards such as riveting, inserting transistors and torquing. There were three others working on the line with the claimant. The employees had to be careful as the work was tedious and each individual was responsible for the quality of her own work. If a mistake was made, it would only be found out at a later stage in the process and a lot of rework would have to be done. Her team leader organised a meeting regarding procedures for those working on the line. The work required flexibility but 90% of the time the preparatory work fell on the claimant. The claimant said she felt under a lot of pressure, as she had to do the preparatory work as well as her line operator work. Difficulties in the company fell on her as other staff were falling down in their work. Team leader B who joined the company in March 1999 had received no proper training and he did not understand how the system worked. The production manager, Mr W knew she was not happy but things improved when Mr C took over as team leader.
The claimant told the Tribunal that she applied for a number of jobs in the company. In June 1999, she applied for the job of lead operator. The claimant said she felt she was well qualified for the position. She was interviewed by Mr W who having gone through her work record and service, asked her if she *263 thought her periods would affect her work. She was shocked but Mr W just laughed. Another employee got the job. In November 1999 the claimant applied for a job in the wave department. She was again interviewed by Mr W who told her that her file was very thick as it was full of sick certs. The claimant told the Tribunal that she had undergone surgery to remove ovarian cysts in April 2000 and prior to this, had spells out sick with endometriosis and related problems. The claimant was offered the wave operator job but she believed that it had first been offered to Ms K who turned it down. The claimant said she accepted the job but regretted doing so almost immediately, as the job required a lot of heavy lifting and there would be fumes from the soldering. The following day she told Mr W that she would not be accepting the wave operator job. He wanted to know the reason for her refusal. Witness felt he was trying to find out about her health problems. She told him she refused on medical grounds. He then asked her if her current job would be affected and she said it would not as it did not involve lifting. In cross-examination witness said that a male employee had come off the wave job because of the lead levels it caused in his body and this was well known in the company. The claimant told the Tribunal that the respondent brought a psychologist from the U.S. to do an analysis and ascertain the reasons for the general air of discontent on the floor and why so many people were leaving the company. Around this time staff had been told that if they had problems, to speak to Ms H. One of the employees remarked that it was a bit late in the day to talk to Ms H when a representative from the U.S. was coming. The claimant felt that she in particular could not talk to Ms H as she felt she would discuss the matter with Mr W.
The employees were told that the meetings with Mr Z would be confidential and that there would be no repercussions arising from them. At her meeting with Mr Z the claimant told him about Mr W’s comment on her periods and he was stunned. On a later occasion when Mr W had seen a mess on the floor he said, ‘What the f*** is going on here’. Then he followed it with ‘Oh, I forgot, I can’t say anything like that around Connie’! This led her to believe that anything she had said to Mr Z would be held against her.
Witness said she was capable of a lot more but in view of the fact that she had made a number of unsuccessful applications for jobs within the company she felt that she would not make any progress in the company. In November 1999, she applied in writing to Ms H, the human resources manager for part-time work, indicating she would like it to begin in April 2000 but Ms H never acknowledged the application. The claimant applied for part-time work because she felt she was making no progress in the company and she felt she was capable of a lot more. She told the Tribunal that she would have probably done some courses if she had got part-time. On January 25 she asked Mr C, her team leader about her part-time and he told her he had given it no thought. She told him she would be happy enough if she got it in September. She did not expect *264 that she would be held to this. Difficulties in the slide line continued and were due in particular to shortages and wrong parts coming from the store. Pressure on the employees and on herself continued. In March 2000 witness started to train an employee who had been moved to her section but she soon realised that this girl had a problem with her eyesight. Some parts they handle are very small and very difficult to insert and the new girl could not see them properly. If mistakes are made they are only discovered down the line and would then be returned to her section to be redone.
The claimant told the Tribunal that her medical problems became more serious and she began a course of injections for endometriosis on May 8, 2000. There are recognised serious side effects to this treatment and she had severe reactions. She suffered severe chest pains and had to go to the accident and emergency department in the hospital. She was checked for a blood clot on the lung but was told she was OK and that that was the way it was going to be because of the injections. The claimant arranged to meet with Ms H on May 19 and she explained her medical situation to her, detailing her operation, injections treatment and the side effects and again asked for part-time work as she now needed it because of her health problems. Ms H told her that Mr W who had left the company had returned that week and asked the claimant if she would not like to come out to welcome him back. The claimant could not understand why this was said to her.
The following week, while the claimant was on sick leave her mother phoned her at home and told her that Mr W had phoned, looking to speak to her and that she had given him her phone number. Subsequently Mr W phoned and said he wanted to speak to her and asked if he could call to her house. The claimant felt good as she thought Mr W was coming to see her to discuss part-time work. When he came into her house, he saw that the TV was on and asked her, ‘Is this what you’re doing with your time, watching TV’? He then told the claimant that things were not going so well in the company and that if she did not come back very shortly her job would be advertised. Mr W told her that if she came back they would try to facilitate her, would organise training for soldering and that she would get part-time as quickly as possible. The claimant said she felt under pressure to get back to work in order to keep her job.
Arrangements were made for the claimant to visit the company doctor, Dr H. He told the claimant to take whatever time was necessary before returning to work. He understood the side effects of her treatment. Her own doctor had been providing certificates on a weekly basis.
On May 30 the claimant rang Ms B the training officer in the company, and told her that she was depressed and worried about her job. Ms B told her she was sure Mr W would understand the position and put him on the phone. The claimant told him she needed another two weeks. She hated having to say it. He huffed down the phone and said, ‘another two weeks’. She put the phone *265 down. It was a bad time for her; she felt terrible but she did not want to lose her job.
The claimant was due back to work on June 12 but she felt she should return sooner, so she went back on June 8. She returned to work on the June 8. She met Ms B in the hall and asked when she could get started on the soldering training but she was evasive and wanted to get away from witness and told her she was ‘up the walls’ and was looking at the end of July. Witness had felt from Mr W that she would get training straight away. Witness had applied for a job in the stores before she went out sick and although another girl got the job while she was out sick, witness had not been informed about this. The claimant met Ms H in the toilet but she did not ask her how she was. The claimant asked her about part-time work. Ms H told the claimant she would have to sort it out with Mr W. When witness told her fellow workers what Ms H had said one of them said that meant she had part-time and advised her to go back in to Ms H to sort it out. When she went into Ms H’s office at the end of the day, Ms H said that what she meant was that the claimant would have to start and organise it all with Mr W. She felt they had no notion of giving her part-time work. She felt she could not go out sick although she was not up to full-time work. The claimant went home that evening and discussed it with her mother. She felt that Mr W did not want her there anymore because of all her problems The claimant wrote a letter of resignation and the following morning went to work.
She asked Mr C if there was anything happening with her request for part-time work and Mr C said, ‘You’ll get it’. She told Mr C that he was messing her around and he replied with, ‘No — You’re messing us around. You told me you’d take it in September’. The claimant told the Tribunal that she had said that, but jokingly. She told Mr C that she ‘needed it now’. She gave Mr C her resignation letter and he accepted it. At 3.30 p.m. that day she was called to Mr W’s office. The claimant hoped it was something to do with part-time work. Mr W was very hostile in manner. He said, ‘You’ve made a decision’. She told him that she felt she had no option but to resign and asked him about the part-time work. He told her, ‘It is way down the line’. He also told her that she was never suited to the place and referred to all the jobs she had gone for and did not get. He told her she could finish there and then and that she need not work her notice considering she was on sick leave. The claimant told the Tribunal that other employees had been able to avail of part-time work. The claimant also said she felt she got no support from the company with her serious medical problems. She had been a worker who worked beyond her brief and this had been recognised by some of her superiors but the respondent had shown no interest in her.
At a union meeting held in November 1998 the claimant volunteered to be one of the shop stewards in the respondent company. At a further meeting in July 1999 a union official informed the members that the matter was going to *266 the Labour Court as the respondent was objecting to having four shop stewards. Some members were angry at this meeting. After the meeting the claimant told Ms H, human resource manger, that she no longer wanted her name to go forward as a shop steward as she did not feel sufficiently experienced to represent the members. She felt this way because she had not taken part in the meeting. Some members who were at the Labour Court hearing told her that Ms H had informed the Labour Court at the hearing that the claimant had withdrawn her name because of conduct at the July meeting.
The SIPTU branch secretary told the Tribunal that he wrote to Ms H on February 1, 1999 asking her to investigate a complaint by four union members that Mr W had used foul and abusive language to them at a meeting on January 28 and had continued the meeting in a threatening manner. Despite a number of further requests (written and over the telephone) to her he had to wait some 13 months for her response. In her response she indicated that the complaint had been investigated at the time of his first request. Witness confirmed to the Tribunal that Ms H had stated at the Labour Court hearing that the claimant had withdrawn because of conduct at the meeting. The claimant later confirmed to him that she had not resigned because of conduct at the meeting.
In cross-examination the claimant said she was aware of the grievance procedures and the fact that there was a provision for her to be represented should she wish to invoke it. She did not get to her union because she did not feel up to it. She felt isolated, depressed and she could not cope with anymore either physically or mentally. She felt from Mr W that she would get part-time more or less straight away. She said that if they had shown her one sign at that stage that she would get it within a week or two she would not have left. Ms B, with whom she had spoken about her condition and position, had been evasive, on edge and did not want to be talking to her. She had already done some soldering. In training she would be put sitting next to someone and Ms B would come and ask how she/the trainee was getting on.
Dr D., the claimant’s general practitioner, told the Tribunal that the claimant had an ongoing thyroid problem, endometriosis and ovarian cysts. She was hospitalised on three occasions since late 1998, the latest being April 2000. On May 8, 2000 she began a course of injections which can have marked and severe side effects such as: sweats, muscle weakness and chest pain, tiredness, mood swings, depression and anxiety. The claimant suffered the full spectrum of these side effects, which were very distressing for the claimant. She had to attend the accident and emergency department for chest pains and symptoms as a result of the treatment. On May 29, 2000 witness certified the claimant to be unfit for work for a further week due to endometriosis and depression.
The claimant was put in medication for depression from May 22 and the claimant was seen by a colleague of witness on June 2. Witness saw the claimant again on June 14, which was after she had left her job. She found her to be *267 categorically unfit for work. She increased her medication for depression and referred her to psychiatric services. The claimant was not in a fit state to make any major decision at this time. Witness said that the company doctor had seen the claimant on May 25. The claimant’s condition would be obvious from a proper medical examination. From the claimant’s history any doctor would be aware of the side effects of her treatment. The company ought to have been aware of her condition. Her opinion of the state of the claimant’s health was dramatically opposed to that of the company doctor. Witness felt the claimant would need three to six months sick leave. She felt part-time would be a help to her. She provided the claimant with sick certificates on a weekly roll-on basis. She had not certified her fit for work when she returned.
The claimant’s husband told the Tribunal that he and the claimant made the decision that she would undergo treatment for her endometriosis and they hoped they would then start a family. They had been informed of the possible side effects. He confirmed that the claimant suffered marked side effects within a short time of starting the treatment. Witness, who is a petty officer with the navy, was away on a UN mission between May 14 and June 16 and was out of contact with her for much of that time. When he reached the first port at the end of May he telephoned the claimant. He said the claimant was upset and he felt that something was wrong but that he was not being told the full story. On his next telephone call, the claimant told him that Mr W had visited her at home. He advised her not to be put under pressure to return to work and that she had medical certificates and had seen the company doctor. On his return home she had already left her job and was very distressed and upset. She told him that if she had not gone back she would lose her job and that Mr W had said it would be advertised.
Respondent’s case
Ms H, the human resource manager, told the Tribunal that the claimant was a good employee. While there was a problem with her attendance record no disciplinary action was taken by the respondent, as they knew that her absences were genuine. Under the company’s disciplinary procedures if an employee’s job was in jeopardy a verbal warning is issued followed by two written warnings, stating that dismissal would take place after the third written warning.
The claimant’s position was not in jeopardy. She applied for a number of internal positions and was offered one of them. After the interviews for these positions had taken place witness met the other interviewer(s) and the person with the highest points got the job. In late 1999 and early 2000, a new system was put in place whereby if employees were not happy with their interview results they could get their own scores and those of the successful candidates. Some of the claimant’s applications were processed through this new system.
Witness said part-time work was available in the company. Unpaid leave, *268 career breaks, parental leave and job sharing were also available to the employees. In the claimants case she would have to move her to another area to facilitate her request and training would have to be provided which would be arranged through her, manager or team leader. Witness said that such a request would never be refused but it may take longer to arrange for a production employee.
The year 1999 was a difficult one for the company. In the claimant’s case a replacement would have to be found and an alternative position within the company sought for the claimant. There is a training centre within the company to provide re-training where necessary. During 1999 there were a number of changes at senior management level and a pay freeze where only half of the profit share was paid out. Recruiting staff was also a problem and this put pressure on the training department. There were five redundancies at the end of 1999 and this created a sense of insecurity amongst the employees. A psychologist came from the parent company in America. He met with the employees in groups of 12 to 15 and he also had some individual interviews. Employees were assured that these were anonymous and confidential. Employees were invited to give their comments about their concerns regarding different aspects of their employment with the respondent. A report was drawn up for management and the issues were addressed. Following this initial survey an annual survey is now carried out and it was found that the employee satisfaction level had increased and turnover in staff has significantly decreased.
Witness provided copies of various procedures including the grievance procedure and harassment procedure referred to in the handbook. The claimant did not raise any complaints under any of these headings. Witness also told the tribunal that she was satisfied that the respondent was planning to put the claimant on part-time hours but this was put off until September at the request of the claimant herself. Witness said she did not believe that Mr W raised the issue of the claimant’s periods at her interview and said that it was not noted in his notes. If it had been raised it would get around the plant quickly and she would have heard it. Witness told the Tribunal that after the union meeting in July the claimant came to her office and said, ‘That’s not for me’. Witness said she asked the claimant for her reasons but that was the end of the conversation.
In cross-examination Ms H agreed that the claimant visited her on May 19 while she was on sick leave. The claimant told her about the difficulties with her periods. She could not recollect whether she was told about the treatment and side effects. Witness could not recollect whether the claimant asked about part-time but agreed that she could not deny that it was discussed. Witness told Mr W about the claimant’s visit, that she was unwell and would be for a few weeks but she did not disclose the claimant’s medical details. She could not recollect telling the claimant on June 8 that she would have to start and organise her part-time with Mr W but witness said as the claimant did contact her it *269 would make sense that she had said so. She had not replied to the claimant’s application for part-time because the application should have been made to a supervisor or team leader.
The respondent company’s doctor, Dr H, is a general practitioner and now specialises as an occupational health physician. He is normally asked to see staff who have been out sick for one week with no return-to-work date or someone who has had three absences in the previous six-month period. He saw the claimant twice. In May 2000 witness requested by the respondent to do a sick absence assessment of the claimant. The respondent did not provide him with the sick certificates from the claimant’s doctor; it would only do so in the case of significant illness. He saw the claimant on May 25 and at this time she was on the course of injections and was suffering side effects. He certified her unfit for work for two further weeks. She did not mention any pressure at work or Mr W’s visit to her home. He could not recall whether she mentioned her visit to hospital due to chest pain. He felt her depression was related to her illness and did not explore it with her nor did he know she was on anti-depressants. He was unaware that she had applied for part-time so he did not explore the benefits of it with her. In cross-examination he agreed that endometriosis is a serious and stressful condition and that one-third of patients suffer very severe symptoms. He also agreed that it would be desirable for sufferers of the condition to have an appropriate company support system. He did not mention the claimant’s health problems to the respondent as they were not work related.
Ms B, who was the training officer in the respondent company at the relevant, time, told the Tribunal that the claimant told her in November 1999 that her medical condition prevented her from taking wave soldering job. She was crying and very distressed at the time. Witness advised her to tell Mr W, which she did. Witness also informed Mr W. In May 2000 Mr W identified a number of employees, including the claimant, who were to be trained. She prepared a schedule of training on May 17 and it was circulated on May 18 so employees and team leaders were fully aware from that date of who was to be trained. Ms B did not know it at the time, but this was to accommodate the claimant’s request for part-time work. If Mr W requested immediate training she could do it but it would mean rescheduling. In general training was up to the team leader and depended on production needs. In general training was up to the team leader and depended on production need but, had Mr W asked her, she could have rescheduled the claimant for training immediately but that would entail rescheduling her programme.
Ms B told the Tribunal that she got a phone call on May 29 or 30, 2000 from the claimant telling her that Mr W had called to her house, that she was worried about her job, she had been depressed but had received treatment for it and that she was concerned that she might not get part-time work. Ms B notified Mr W that the claimant had a medical condition. If he had wished she *270 would have divulged to him the nature of her medical condition but he did not ask. She found the claimant to be very distressed and erratic and she said it was not a conversation as the claimant was jumping from thing to thing. Witness met Mr W before the claimant rang him that day and gave him a brief overview of their conversation. Ms B found it strange that the claimant was seeking training for soldering as she had refused the wave soldering job the previous November. Mr W informed witness on June 9 that the claimant had resigned and he was surprised. Ms B told the Tribunal that she was not aware whether the claimant had told anyone in the company of her illness. Ms B would not pass on information of this nature unless asked to do so. In cross examination witness agreed that the claimant’s training for soldering had been arranged prior to the claimant’s phone call to her on May 29, but she could not remember if she told her so. It was not her function to advise employees of such matters.
Mr S. works for the respondent as a business unit manager and he reports to the general manager. He told the Tribunal that the claimant was a good employee and he was not aware of her absences. He said that the respondent company tries hard to communicate and to build up a rapport with its employees. Staff can talk to supervisors and managers. The company has an ‘open door’ policy and if staff have any difficulties, they can come in and talk to any manager. The claimant never raised any personal issues with him. He knew the claimant had applied for part-time work and the company had agreed to set it up for September, which was when the claimant had requested it to start; for that reason, there was no rush to organise it any sooner. He was aware that Mr W was going to meet the claimant in her home on an informal visit. The company had arranged such meetings before; people often feel more comfortable at home. In cross-examination, Mr S. told the Tribunal that he spoke to the claimant after he had heard about her resignation. He was surprised. He told her that she was to get part-time work in September. The claimant said to him that she knew but that she had to leave for personal reasons. Mr S. also said that he offered the claimant a reference and a job in the future but she had made up her mind.
Mr W, production manager, told the Tribunal that he interviewed and recruited the claimant. He said the claimant had four years experience in a similar industry and was regarded as a good catch for the company. The claimant was able to do her job and there were never any issues or problems regarding her conduct or performance. She was a valuable employee. The claimant applied for eight promotions in total and was successful, in one application. Witness interviewed the claimant for three of the eight positions and it was in one of these that the claimant was successful. He denied offering the job to another employee before offering it to the claimant. He said the claimant accepted it but later told him that she could not take it for personal reasons. Mr W said that *271 if the claimant had cited health reasons, he would have wanted to know more details. The company does not make provision for part-time work but does for job-sharing, but employees see it as part-time. No one has ever been refused part-time. The claimant applied for part-time work in November 1999 to begin in April 2000 and the company was prepared to organise the claimant’s request but it was five months away so there was no hurry. He told the claimant that he would process her application but that he would have to organise training for it. He said that the urgency to organise the claimant’s request was lessened further when she told Mr C at the end of January 2000 that September would do. He said that there was never a doubt that the company would accede to the claimant’s request.
Mr W told the Tribunal the claimant’s demeanour and performance had changed and that she was switching off at work, so he decided to visit her at home to talk to her. He was not aware of the medical condition from which she suffered. He phoned the claimant before the visit to see if it was OK to visit her and she said it was. The claimant’s demeanour was fine when he met her and she did not mention any non-work issues. He told her that the format for her part-time work had not been decided. He never put pressure on the claimant to come back to work because she was out sick nor did he say he would advertise her job. The company has never dismissed anyone for being out sick. It would make no sense to do so as the company has a sick-pay scheme.
The claimant returned to work on June 8 and was also at work on June 9. Mr C informed him that the claimant had come to him and said she was resigning unless she got part-time work immediately and had given him her handwritten resignation. Mr W met with the claimant late on June 9 and brought her into the conference room. He asked the claimant if she was sure about what she was doing and she said she was and that she had too many personal problems. He offered to pay the claimant her notice and she agreed that she did not want to come in.
In cross-examination witness said he had verbally acknowledged the claimant’s request for part-time and that the company would have written to the claimant closer to the commencement of the part-time work. He was not fully aware of the claimant’s illness and depression; he had not seen her medical certificates at the time and did not really want to know why she was out sick, just why she seemed to be switching off. He told the Tribunal he was not aware that the claimant’s mother had made a phone call to the respondent company informing it that the claimant had gone to hospital with chest pain or that the claimant herself had disclosed the nature of her health problems to Ms H, the human resource manager. He categorically denied telling the claimant on June 9 that she was never suited on the company or that he had referred to all the jobs she had unsuccessfully applied for. He also denied telling the claimant that training for the soldering was away down the line. Witness told the Tribu *272 nal that he does not see medical certificates when they come in. He did not visit the claimant at home because of her absence but because of her demeanour and performance at work over the previous months.
Mr C, a team leader and the claimant’s supervisor for the 11 months prior to the termination of her employment, told the Tribunal that the claimant’s attendance was not a disciplinary issue and that the claimant was under the same pressure on the slide line as everyone else. There is a high turnover and everyone works hard. Witness said he could not remember if he was aware of the claimant’s request for part-time before January 2000 but that in January 2000 she wanted it in September 2000. The claimant never raised any work related problems or grievances. The only time the claimant said she wanted to have the part-time issue hurried was the day she resigned. The claimant came to him on June 8 and said she needed the part-time straight away or she would hand in her notice. He told her he could not accede to her request. This was an unreasonable demand. Witness told the Tribunal that this was not possible for operational reasons; employees were going on annual leave; her current post would have to be filled and training would have to be organised. In cross-examination, when witness was asked why he did not tell the claimant that training for soldering was being organised, he said he may have told her.
The claimant was recalled on the issue of whether Mr S. had told the claimant, subsequent to her handing in her notice that part-time work would be organised for her in September. She said that he had not told her so and that she would have been delighted to hear it. Ms May told the Tribunal that no such conversation took place with Mr S. regarding plans for part-time working.
Determination of the majority
The claimant suffered from a serious and stressful medical condition and from the full spectrum of the recognised side effects of the treatment for the condition, many of which were very severe and included depression. She was absent from work on sick leave from May 15, 2000. Her doctor was providing medical certificates on a weekly roll-on basis. While there was no medical certificate produced to the Tribunal covering her absence for the week beginning June 5 the claimant did visit her doctor’s colleague on June 2 and it was the claimant’s uncontroverted evidence to the Tribunal that she was due back to work on June 12, at a time when according to her doctor’s evidence she was categorically unfit to return to work.
The Tribunal asks itself why did the claimant return to work on June 8. The majority accepts the claimant’s evidence and finds that she returned to work on June 8 as she felt under pressure to do so because her manager had told her when he visited her in her home on May 23 that if she did not get back to work very shortly her job would be advertised. The majority’s finding on this issue is supported by the evidence of Ms B, a witness for the respondent who told the *273 respondent that the claimant had rung her in a very distressed state on the May 29 worried that she might lose her job. There is further supporting evidence from the claimant’s husband, who was away on a UN foreign mission at the time, that he was concerned from his phone conversations with the claimant that she might be under pressure to return to work and that he advised her not to be pressurised into returning.
Having been informed by the human resource manager of the claimant’s visit to her on May 19 (at a time when the claimant was absent on sick leave) and that the claimant was unwell, Mr W decided to visit the claimant at her home. His evidence to the Tribunal was that he did so because the claimant had been switching off at work and he had been concerned about her performance and demeanour at work over the previous few months and not because of her health problems. Mr W did not fully inform himself before this visit of the totality of the information on the claimant’s health which had been provided to the respondent. The majority finds that the manager’s visit to the claimant on May 23 was inappropriate and unreasonable in the circumstances.
It was the respondent’s case that the claimant resigned on June 9, 2000 because she did not get part-time work. The claimant was a full-time employee. In general there is no entitlement to change from full-time to part-time employment. However, it was company policy to facilitate such requests and its evidence to the Tribunal was that it intended to accede to the claimant’s request for part-time work. In November 1999 the claimant applied for part-time work as she felt she was making no progress in the company. In November 1999 she indicated that she would like the part time to begin in April 2000. She received no response to her written application. In January 2000 she broached the subject with her team leader and indicated to him that she would be satisfied if it were to begin in September 2000. In June 2000 the claimant’s reason for wanting part-time changed; she now needed it on health grounds. The claimant returned to work on June 8 believing that she would get part-time ‘as quickly as possible’. Response to her enquiries on the issue over June 8 and June 9 were for the most part vague and even contradictory. Furthermore, although the claimant had been listed for training in June in the schedule prepared by the training officer on May 17 to 18, neither Mr W nor the training officer informed her of this when they discussed the matter with her on May 23 and May 29 to 30 respectively. The respondent’s communication to the claimant on the issue of part-time undermined her confidence that the company would grant her part-time employment.
When the claimant did not get part-time work she tendered her letter of resignation to her team leader on June 9 and he in turn told her manager that she was resigning because she did not get part-time work. The manager called her to a meeting late that afternoon. At the meeting there was no exploration of the reason(s) why someone who had just returned to work the day before was *274 now resigning and whether it might be connected with her illness. It is the opinion of the majority that given the claimant’s recent medical history, a fair-minded employer would have apprised himself before this meeting of the information on the claimant’s health which the respondent company had in its possession at that time, which included the medical certificate of May 29 stating that she was suffering from depression. There is a conflict of evidence as to the conversation that took place at that meeting. According to the manager’s evidence and file note part-time was not discussed. In light of the manager’s own evidence, that he had been informed by the claimant’s team leader that she was resigning because she did not get part-time, the majority prefers the claimant’s evidence on the issue. It finds that the manager acted unreasonably in telling her that part time was ‘way down the line’. Furthermore, the majority notes that by telling the claimant at the meeting of June 9 that she could finish there and then, although she had proffered two weeks notice in her letter of resignation the manager was precluding any further opportunity whereby a possible alternative solution to her situation could be reached.
The claimant’s resignation must be looked at in the context of her return to work. The claimant who was in a vulnerable state of mind, returned to work because, as a result of the manager’s visit and what he said, she was afraid she would lose her job. She was not in a fit state either physically or psychologically for work and the medical evidence was that she would remain so for some months. The respondent ought to have been aware of the state of her health as it had the certificate of May 29 in its possession on June 9, the date she tendered her resignation. In the circumstances the majority finds that the real reason for the claimant’s resignation was that she was unfit for work. For the reasons outlined earlier and for its failure to demonstrate any concern or consideration for the state of the claimants health, the majority finds that the respondent acted unreasonably.
Applying the reasonableness in this constructive dismissal case the majority finds that in the exceptional circumstances of this case, the claimant’s resignation due to the state of her health was reasonable. Her failure to use the grievance procedure because she felt ‘isolated and depressed and could cope with no more either physically or mentally’ is not fatal to her claim in the exceptional circumstances outlined. The majority determines that the claim for constructive dismissal succeeds.
Dissenting opinion of Mr O’Leary
Constructive dismissal arises where the employer is guilty of conduct which is either a significant breach going to the root of the contract, or, which shows that the employee no longer intends to be bound by one or more of the essential terms of the contract.
I find that there never was at any time, any question that the behaviour *275 could be so classified. Even if, in the claimant’s opinion she believed that the respondent had so acted she did not complain to plant manager, the department manager, the human resources manager or even to her trade union. The claimant was fully aware of grievance procedures agreed between the respondent and her trade union. She had in fact used that procedure in the previous year, to successfully address, with the assistance of her trade union, a grievance that had arisen at that time. In unfair dismissal cases employers are expected to show that they have acted reasonably. Similarly in constructive dismissal cases the onus is on the claimant to show that he/she has acted reasonably. I find the claimant failed to take any steps to rectify any grievances she may have had. I find that the claimant acted most unreasonably. The claimant applied for part-time work in September 1999. It was hoped that this part-time work would be available in April 2000. She accepted that training would be required to enable her to perform this type of work. The reason she applied for part-time work was that she felt under pressure in her job, that she was capable of much more and she might be able to pursue education to help her to embark on a more rewarding career. Unfortunately the claimant became ill and was absent from work from May 15, 2000 to June 8, 2000 (she was also absent on two occasions in April 2000). When she returned to work it appeared that her only concern was her request for part-time work. She told the Tribunal that at one stage she was quite happy to get the part-time work in September 2000.
Her evidence to the Tribunal was that on June 8, 2000 she said, ‘I can’t carry on full-time’ she was ‘happy enough with part-time in September’ and ‘I really need it now’. She presented her letter of resignation to the respondent on June 9, 2000.
I find it impossible to accept that that claimant was justified in resigning from her full-time permanent position with the respondent, whose behaviour is alleged to be such that warrants that resignation, while at the same time she is clamouring for a part-time position with that same employer.
When the claimant went on sick leave on the May 15, 2000 her certificate stated she was suffering from endometriosis. She was again certified for a further week for the same condition on May 22, 2000. It was not until the third certificate for the period from May 29, 2000 to June 4, 2000 that the condition of depression appeared on the medical certificate. Mr W, or for that matter any member of management, could not have known of this development when he called to see her on May 23, 2000. Furthermore it was not until evidence was given to the Tribunal that her medical doctor that the respondent became aware that the claimant’s condition was such that she was referred for psychiatric services on June 14, 2000 and would not have been fit for work for two to three months. I also note that the respondent did not receive medical certificates for the period June 5, 2000 onwards.
The majority of the Tribunal finds that the real reason for the claimant’s *276 resignation was that she was physically and psychologically unfit for work at the time. If that were so then the proper and reasonable course for the claimant was to remain on the generous company disability scheme. Under the terms of that scheme she had at that time an entitlement to a further substantial period of paid sick leave. Even if the claimant’s entitlements under that scheme were all used up, she could have availed of the equally generous company income continuance plan.
Generally speaking there is no entitlement to change from a full-time employment contract to a part-time contract. In this case the respondent had at all times indicated its willingness to facilitate the claimant, albeit in a different job, for which training would be required. In the spring and early summer of 2000 the respondent engaged in a major recruitment drive involving substantial training demands. Staff absent on summer leave also created difficulties for the respondent. In the circumstances the respondent could not fast track training for the claimant, even if she had requested it. In all the circumstances I find that the claimant was not constructively dismissed.
The claim under the Unfair Dismissals Acts 1977 to 1993 having succeeded, the Tribunal feels that compensation is the appropriate award in this case. It awards the claimant the sum of £6,278.85 under these Acts.
ATR Restoration Limited v Marek Zalewski
UDD1818
Labour Court
15 March 2018
[2019] 30 E.L.R. 95
Subject
1. An appeal of an Adjudication Officer’s Decision No: ADJ-00000207.
Background
1. The worker appealed the decision of the Adjudication Officer to the Labour Court on 5 May 2017 in accordance with s.8(A) of the Unfair Dismissals Act 1977 to 2015. Two Labour Court hearings took place on 21 September 2017 and 18 January 2018. The following is the determination of the court.
Determination
This matter comes before the court as an appeal by Marek Zalewski (the appellant) of a decision of an Adjudication Officer in his complaint made under the Unfair Dismissals Acts 1977 to 2015 (the Act) against his then employer, ATR Restoration Limited (the respondent) that he had been constructively dismissed.
The Adjudication Officer, in a decision made on 5 April 2017, decided that the complaint was not well-founded and that it failed.
The appeal to this court was received on 5 May 2017.
The fact of dismissal is in dispute.
Background
The appellant was employed by the respondent from 29 April 2013 until the date he claims his employment terminated on 10 June 2015.
A number of work-related incidents and interactions had taken place between the appellant and the respondent up to and including the end of 2014. At a meeting in December 2014 between the appellant and two directors of the respondent the parties discussed the matters that had arisen prior to that date.
Further interaction between the parties on 27 February 2015 resulted in a meeting between the appellant and the two directors of the respondent on 2 March 2015.
Following that meeting, e-mail contacts between the appellant and the directors of the respondent ensued. The appellant supplied a medical certificate on 9 March 2015, which certified that he was suffering from stress and was unfit for work until 22 March 2015. The appellant attended his own doctor on 23 March 2015 and supplied a medical certificate covering the period to 29 March 2015.
The appellant attended the respondent’s doctor at the request of the respondent on 25 March 2015. That doctor compiled a report for the respondents as a result.
*97
That report certified to the respondent that the appellant was suffering an acute crisis in relation to perceived workplace stress and was unfit for work and likely to continue to be so for as little as one month and as much as six months.
The respondent’s doctor, in that report, stated that it would be important to address the perceived stressors at work before he returned to work and the doctor suggested a process of external mediation.
On 10 April 2015, the appellant’s legal representative wrote to the respondent stating that the treatment which the appellant had received from the two directors of the respondent since 2013 had caused his absence from work as a result of stress and anxiety. The appellant’s representative, in that letter, invoked the respondent’s bullying and harassment policy on behalf of the appellant and advised that the appellant’s medical doctor had certified him as medically able to participate in an investigation of his complaint of bullying and harassment against two directors of the respondent.
The respondent’s bullying and harassment policy is clear in its terms. That policy commits the respondent to take particular actions in response to a complaint of bullying or harassment. In particular, the policy commits the respondent to initiating an investigation by appropriate management or, if management are the subject of the complaint, by an independent party appointed for the purpose. That policy sets out timelines and procedures, which will be followed upon receipt of a complaint.
On 20 April 2015, the respondent wrote to the appellant stating that the respondent would await the appellant’s return to work “at which stage we can meet and discuss any issues you may have in line with your contract of employment”.
The appellant’s legal advisers responded to that letter on 15 May 2015 reiterating the request for the commencement of a process as requested in his previous letter and confirming that the appellant was fit to participate in such a process.
The appellant had received no response to that letter by 10 June 2015 and on that date, by letter, notified the respondent that, because it was clear to him that the respondent had “no intention of affording him his contractual entitlement to have his complaint investigated”, he was resigning his employment with the respondent effective immediately and advising that he regarded himself as constructively dismissed.
On 17 June 2015, the respondent replied to that letter indicating that no formal statement in writing had been received from the appellant as regards alleged bullying and harassment and indicating that upon receipt of such a statement a process would be initiated.
Summary position of the appellant
The appellant submitted that, arising from his contract and the basic requirements of fair procedure, he had an entitlement to have his legitimate and serious *98 complaint of bullying and harassment investigated by the respondent. He submitted that the respondent had repeatedly and deliberately failed to comply with its own procedures following requests from him to initiate those procedures. The appellant submitted that those failures left him in a position whereby it was perfectly reasonable for him to ultimately resign from his employment.
The appellant submitted that he had repeatedly made informal complaints of bullying and harassment and ultimately was unable to continue working as a result of stress. The appellant referred to the respondent’s own doctor’s report which advised that the issues giving rise to perceived stress should be addressed prior to his return to work from the period of sick leave which had commenced in March 2015.
The appellant submitted that the failure of the respondent to initiate a procedure in line with the bullying and harassment policy following the invocation by him of that policy in letters dated 10 April 2015 and 15 May 2015 left him with no option but to resign.
Summary position of the respondent
The respondent submitted that issues with the appellant’s performance started arising in 2014 and that this resulted in one or other of the two directors of the respondent talking to the appellant over time about the fact that he was not getting reports in on time, his attendance at work, his attending at work out of uniform and his use of Skype and his mobile phone during working hours. The respondent submitted that these matters were disrupting the completion of work. In addition, the respondent submitted that the appellant constantly requested advances of salary and looked for pay rises.
The respondent submitted that these matters resulted, in December 2014, in a meeting between the appellant and the two directors of the respondent.
The respondent submitted that, in the view of the directors, this meeting was a positive one. A pay rise was afforded to the appellant and the respondent expected a much more positive approach from the appellant in 2015.
In January 2015 the appellant requested that he be allowed to work from home for two days each week and that request was declined. A range of issues arose in February 2015 including the appellant’s abrupt departure from the workplace one day and in addition a failure to follow up work on a site on another occasion.
The respondent submitted that events on 27 February 2015 resulted in a meeting on 2 March 2015 between the appellant and the two directors wherein the directors expressed dissatisfaction with various aspects of the appellant’s performance and communication.
The respondent submitted that the appellant was absent from work on sick leave from 9 March and that certificates were received addressing the period up to 29 March 2015 but that none had been received thereafter.
The respondent submitted that the appellant had been required to attend a *99 doctor appointed by the respondent on 25 March 20015 who confirmed that the appellant’s absence was likely to be lengthy. That left the respondent with a requirement to plan for that absence.
The respondent submitted that it was surprised to receive the appellant’s letter of 10 April 2015 and took advice as to how to reply. That advice led to the letter of 20 April 2015.
The respondent submitted that the letter of 15 May from the appellant was a surprise to the two directors contending as it did that the appellant had raised concerns at his treatment by the two directors.
The respondent submitted that at about this time it had come to its attention that the appellant was working in another business while certified as unfit for work with the respondent. The respondent engaged a private investigator to visit that business. That investigator established that the appellant was actively and fully involved in the business and advised the respondent that the appellant had stated that he was a shareholder in the business.
Following receipt of the appellant’s letter of 10 June 2015 the respondent received advice from its HR adviser and that advice resulted in the respondent’s letter of 20 June 2015.
The respondent submitted that the appellant had never formally raised a grievance as regards bullying and harassment. The respondent further submitted that the appellant had produced no medical certification after 29 March and that the reason he did not do so was because he was not unfit for work and in fact was working with another business at that time.
Summary testimony on behalf of the appellant
The appellant gave evidence as to difficulties he had working with the two directors of the company dating from September 2013. He gave evidence as regards continuing challenges and difficulties in the relationship, which he characterised as bullying and harassment and which he said caused him stress over a prolonged period.
He said that an interaction took place on 27 February between himself and a director of the company, which was of a nature that he felt it necessary to e-mail both directors to refer to the use of harsh words and “bully boy” tactics and to say that the interactions were having an effect on his nerves.
He said that at a meeting on 2 March, one director had apologised for the tone of the engagement on 27 February.
He gave evidence to the effect that his experiences over a long period had led him to feel depressed and stressed. He said he went to his own doctor in March and that his own doctor had certified him as unfit for work from 10 March onwards.
He said that he had carried out some work for a friend of his in the evenings but he had not been paid for that work. He said that the respondent had never raised an issue as regards this matter while he was in employment or afterwards *100 until the hearing of his complaint by an Adjudication Officer of the Workplace Relations Commission. He said that he did not leave this employment to work with this other company. He said that he never advised the person who turned out to be an investigator of the respondent that he was a shareholder or actively involved in his friend’s company.
He said that he had, through his legal adviser, invoked the respondent’s bullying and harassment policy by letter of 10 April 2015 and that no steps had been taken by the respondent to initiate the policy by 10 June 2015 despite a further letter requesting the commencement of an investigation dated 15 May 2015. He said that at that point he was absent through stress-related illness from his work and could no longer tolerate the absence of pay while awaiting an indication from the respondent that the bullying and harassment policy would be initiated. He said that the stress he suffered related to his experience of bullying and harassment by the two directors of the respondent and the failure to investigate his complaint meant that no resolution to that matter could be found. He said that he was in a position to work in another environment with another employer but not with this employer in the absence of a resolution of his complaint of bullying and harassment.
Evidence of behalf of the respondent
The respondent tendered evidence by an accounts person who stated that issues had arisen as regards the appellant’s pay but those issues were related to an overpayment in 2013 based on the payment of a thirteenth month.
The two directors gave evidence to the effect that there had been issues between the respondent and the appellant leading up to a meeting in December 2014 between the appellant and the two directors. The directors both gave evidence to the effect that the meeting in December 2014 had cleared those issues and that going forward from that meeting matters were considered by the respondent to be positive. The respondent considered that all parties had a shared understanding as to how work would be carried out.
Evidence was given that the appellant had sought a facility to work from home on two days per week in early 2015 and that was refused for business reasons.
Evidence was given that a call was received from a client on 27 February 2015 wherein the client made a complaint regarding a fault arising from work on their premises for which the appellant was responsible. The client premises was a site for which the appellant was responsible. Mr F, a director, stated that a phone call had taken place between himself and the appellant in relation to the matter on 27 February. Mr F stated that the phone call was argumentative and heated. At the end of that call a meeting was arranged for the following Monday 27 February 2015. Mr F stated that this was not a disciplinary meeting.
Evidence was given to the court that Mr F apologised to the appellant in respect of the interaction on the previous Friday at the meeting on 2 March.
*101
Evidence was given that the appellant had stated at the meeting that he believed that both directors were bullying him.
The directors gave evidence that upon receipt of a letter from the appellant’s legal representative dated 10 April 2015 seeking to invoke the respondent’s bullying and harassment policy the respondent took advice on the matter and that advice led to the issue of the respondent’s letter of 20 April.
Evidence was given that a further letter was received, dated 15 May 2015. At or about that time the respondent had become aware that the appellant was allegedly engaged in other work while he was certified unfit for work with the respondent. The respondent engaged an investigator to examine that matter. Following receipt of the appellant’s letter of 10 June 2015, further advice was taken.
The respondent did not reply to the letter of 15 May 2015 until 17 June 2015.
The court also heard evidence from a private investigator who had been employed by the respondent. That investigator stated that he had encountered the appellant carrying out work in another company and concluded from his interaction with him at that company that he was actively involved in that company.
The law
Section 1 of the Unfair Dismissals Acts 1977-2007 defines dismissal as:
(a) the termination by his employer of the employee’s contract of employment with the employer, whether prior notice of the termination was or was not given to the employee;
(b) the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer; or
(c) the expiration of a contract of employment for a fixed term without its being renewed under the same contract or, in the case of a contract for a specified purpose (being a purpose of such a kind that the duration of the contract was limited but was, at the time of its making, incapable of precise ascertainment), the cesser of the purpose.
Paragraph (b) of this definition is relevant in the instant case.
Discussion and conclusions
It is well-settled law that a complainant who is advancing a claim of constructive unfair dismissal under the Act must demonstrate that his or her employer has acted so unreasonably and/or committed a fundamental breach of contract such that it was not possible for that person to remain in their employment any longer.
*102
As the appellant is alleging constructive dismissal, the fact of dismissal is in dispute. Thus the onus of proof rests with the appellant to establish that the actions of the respondent were such as to justify his terminating his employment.
In the instant case, the appellant claims that the failure of the respondent to take action following two requests for the initiation of the procedure set out in the respondent’s dignity at work policy constitutes behaviour of such an unreasonable nature as to leave him no alternative but to consider himself constructively dismissed.
It is common case that the appellant, through his legal adviser, requested the initiation of the procedure outlined in the respondent’s bullying and harassment policy in letters dated 10 April 2015 and again on 17 May 2015. It is not in dispute that the appellant had been certified as unfit for work due to stress with effect from 10 March 2015. It is also undisputed that, the appellant having attended the respondent’s doctor on 25 March, the respondent was advised by that doctor that the appellant was unfit for work and likely to be so for some time. The same doctor’s report recommended that the appellant’s perceived workplace issues should be addressed before his return to work.
Notwithstanding this context for the appellant’s subsequent requests for the initiation of the prescribed procedure to address his claims of alleged bullying and harassment, no such procedure was initiated. In fact, no reply at all was received by the appellant to his request of 17 May in advance of his notification on 10 June 2015 that he was terminating his employment.
Much emphasis has been laid by the respondent on the appellant’s work performance prior to his leaving the employment on sick leave. Similarly, the appellant has claimed that he was bullied and harassed by two directors of the respondent for a period of years prior to the termination by him of his employment.
The court notes that the respondent has in place a comprehensive policy providing for various responses to complaints of bullying and harassment. There is no dispute that the appellant made complaints of bullying and harassment. It is similarly undisputed that no steps were taken to deal with those complaints prior to the termination by the appellant of his employment.
It is not for this court to make findings as to whether or not the appellant was bullied or harassed by two directors of the respondent. The court simply draws the factual conclusion that no investigation of such complaints ever took place.
The court finds that the allegations that the appellant was working in another location while unavailable through illness to work at the respondent’s location was never put to the appellant while he was in his employment of the respondent. The court also finds that any suspicion of that nature which the respondent may have held between 10 April 2015 and 10 June 2015 did not prevent the respondent in that period from dealing with the appellant’s complaints of bullying and harassment in the manner set out in the respondent’s own procedures.
The court finds that the fact that the respondent wrote to the appellant on *103 17 June 2015, seven days after the date of the alleged constructive dismissal, is not relevant to the court’s consideration of the complaint that the appellant was entitled to terminate his employment and to regard himself as unfairly dismissed on 10 June 2015.
The court notes that the respondent failed to initiate the procedure set out in its own bullying and harassment policy notwithstanding its own doctor’s assertion in his report that matters perceived to be causing stress to the appellant in his workplace should be addressed prior to his return to work.
The question for the court to decide is whether, because of the conduct of the respondent, the appellant was entitled, or it was reasonable for him, to terminate the contract of employment.
In all of the circumstances the court finds that the respondent’s failure to initiate the policies in place in the employment between the period of 10 April and 10 June 2015 constitutes behaviour of such a nature by the respondent that it was reasonable for the appellant to terminate his employment.
The court finds that the appellant was unfairly dismissed. The court finds that the appropriate redress is compensation. The court has received details as regards the appellant’s loss arising from his dismissal and his attempts to mitigate that loss. The court notes that in some respects the level of detail supplied does not demonstrate clearly the appellant’s income in the period since his dismissal or his efforts across that entire period to mitigate his loss. Taking these factors and the parties’ submissions into account, the court measures the appropriate compensation in this case at €17,500.
Determination
The appeal is allowed and the decision of the Adjudication Officer is set aside and substituted with this Determination. The court orders the respondent to pay the appellant compensation in the sum of €17,500.
The court so determines.
Liz Allen v Independent Newspapers (Ireland) Ltd
UD 641/2000
Employment Appeals Tribunal
2 August 2001
[2002] 13 E.L.R. 84
Dismissal was in dispute in this case.
The claimant was employed as a crime correspondent with the respondent from August 12, 1996 to September 20, 2000. On the latter date she resigned her employment with the respondent. It is the claimant’s case as set out in the T1A that she was constructively dismissed in that the conduct of her employer and their treatment and attitude towards the claimant left her no choice but to terminate her employment. It is the claimant’s contention that she was sub *86 jected to continuous harassment and bullying and that she was effectively isolated at work which conduct undermined her confidence and health to such a degree that she could not tolerate her working environment and was left with no other option but to resign. The respondent for its part denies that the claimant was constructively dismissed and maintains that she resigned her position without just cause. The respondent denies any conduct, treatment or attitude towards the claimant such as would justify her resignation. Moreover, the respondent denies the claimant’s contention that she made numerous attempts to resolve matters internally before being left with no option but to resign. It is contended on behalf of the respondent that it was open to the claimant to seek to redress any grievance or difficulties she had through recognised NUJ grievance procedures but that the claimant had not availed of this option. Furthermore it is contended by the respondent that the claimant declined to avail of an internal resolution mechanism being made available to the claimant before her resignation.
During the course of the hearing the claimant gave evidence of what she perceived to be hostile treatment of her during the tenure of her employment. The claimant gave specific evidence regarding her working relationship with a colleague, Jody Corcoran who the claimant alleges, behaved in a hostile manner towards her from the commencement of her employment. This hostility consisted of the claimant being ignored by Mr Corcoran and by the latter refusing to communicate with the claimant in any shape or form. Moreover, it is contended by the claimant that Mr Corcoran made unflattering remarks about her to other colleagues and on one particular occasion referred to the claimant as being ‘stuck-up’. It is the claimant’s evidence that she felt threatened by this, behaviour which situation was not helped by the claimant’s perception that her immediate boss, Mr Willie Kealy, news editor, was also behaving in an antagonistic and impatient manner towards her. The Tribunal was told that the claimant made no complaint to anybody about her perception of her working environment until late 1998. The claimant told the Tribunal that up to this time although perplexed at this treatment by a work colleague she made a decision to try and get on with her work. Her evidence was that the hostility intensified in late 1997 and in to 1998.
The Tribunal was told that in August 1998 while on a staff cruise around Dublin Bay, the claimant took the opportunity to speak to Mr Corcoran directly about the atmosphere in the office. It was the claimant’s evidence that she took this decision as she felt her work would suffer if matters continued as they did. It was her evidence that, when approached, Mr Corcoran professed not to know what the claimant was talking about. In evidence to the Tribunal Mr Corcoran denied the allegations being made by the claimant but conceded that in August 1998 the claimant had approached him and he agreed that the subject-matter of her discussion was what she perceived to be the bad atmosphere in the office. *87 Mr Corcoran denies however, being aggressive towards the claimant in his response to her on that date and moreover, it is Mr Corcoran’s contention that he had at all times been reasonable and friendly with the claimant in the work environment.
The Tribunal was told by the claimant that following this approach, the situation in the work environment continued as before but the claimant did not raise the issue with senior management between August 1998 and September 1999. In September 1999 the claimant initiated a meeting with her immediate superior, Mr Willie Kealy. The events, which triggered this meeting were as follows.
In August the claimant had been invited to a meeting with Angus Fanning, editor of the Sunday Independent and Ann Harris, features editor and deputy editor. In the course of this meeting the claimant was told by Ms Harris that the respondent had come up with the idea that the claimant might replace Terry Keane who had resigned her position as columnist with the Sunday Independent. The claimant understood this to mean she would no longer be crime correspondent but rather the replacement for the ‘Keane Edge’. The claimant’s initial response to the respondent’s suggestion was one of astonishment and bafflement and she had immediately declined the offer. However, a day later the claimant advised Mr Fanning that she would do the ‘Keane Edge’ column on a trial basis provided she could continue to do crime stories in the same week. The claimant told the Tribunal that the factor which led her to agree to the ‘Keane Edge’ column on a trial basis was the fact that she had been approached by two of the most senior people in the newspaper. Having written the ‘Keane Edge’ column for a week the claimant informed Mr Fanning of her decision not to continue with this column. It is the claimant’s evidence that Mr Fanning reacted with anger at her decision. It is around this time that the claimant alleges Mr Corcoran hurled a cigarette at her feet, an action strenuously denied by Mr Corcoran in his evidence to this Tribunal. The Tribunal makes no specific finding in relation to this alleged incident
The Tribunal was told by Ms Allen that within a week of her rejecting the ‘Keane Edge’ offer she received a memo from Mr Kealy requesting her attendance in the office on a daily basis from 10 a.m. This memo was addressed to the claimant and four other colleagues. The claimant had concerns about the contents of the memo which she saw as an interference with the flexible working conditions agreed between herself and Mr Fanning at the commencement of her employment and which, if she were to accept the memo and still work as an effective crime correspondent, would effectively mean she would be constantly working. Prior to meeting Mr Kealy, the claimant had approached Kevin Moore, Father of the NUJ chapel, to complain about the memo. Mr Moore had told the claimant it was his belief that the memo was designed to get at her. In this regard the Tribunal notes Mr Moore’s own evidence regarding the memo, *88 in particular his evidence of having himself (as a recipient of the memo) approached Mr Kealy about same and having being assured by Mr Kealy that the object of the memo was to get the claimant into the office at a specified time. Mr Moore confirmed to the Tribunal his belief that the memo was designed for Ms Allen.
In addition to her concerns regarding the memo in question the claimant in her evidence outlined the other factors which led her to seek a meeting with Mr Kealy in September 1999. The Tribunal was told by the claimant that at this time she continued to be ignored both by Mr Corcoran and Mr Kealy, which treatment was affecting the claimant both at home and at work. She made this complaint of being ignored by both men to Mr Kealy and told him that she did not want negativity to prevail in the workplace. Moreover, the claimant had heard rumours to the effect that other crime journalists were being recruited by the respondent and that Mr Corcoran had offered the claimant’s job to a third party. At the meeting in September the claimant advised Mr Kealy of these grievances and told him of the effect it was having on her morale and the possible it might have on her productivity. The claimant had advised Mr Kealy that if the negativity and hostility in the workplace was not dealt with she felt she would have a nervous breakdown. The claimant had been in tears for most of this meeting.
The Tribunal note Mr Kealy’s evidence of the meeting with Ms Allen in September 1999. In his residence Mr Kealy acknowledged that for the greater part of this meeting the claimant was in an extremely upset state. Mr Kealy in his evidence did not dispute that the claimant had made complaint about her working relationship with Mr Corcoran or that she had raised the issue of having heard both from colleagues and on the street that a named third party was being recruited as crime correspondent. The Tribunal was told that Mr Kealy had advised the claimant of the circumstances in which recruiting the third party came about and he had advised the claimant that her job as a crime correspondent was not in jeopardy. Mr Kealy disputed Ms Allen’s account of their discussion regarding her work hours. It was Mr Kealy’s evidence that at this meeting in September the claimant had requested from him that she work from home, a request Mr Kealy refused on the basis that the claimant would have had no chance of improving her integration into the team and on the basis that it would be detrimental to the running of the office.
Both the claimant and Mr Kealy agreed in evidence that the September 1999 meeting ended with Mr Kealy agreeing to raise with Mr Corcoran the issues outlined by the claimant at the meeting.
In the course of her evidence Ms Allen told the Tribunal that at no stage after this meeting did Mr Kealy revert to her about the issues and concerns she had regarding Mr Corcoran. In his evidence Mr Kealy agreed that he did not revert to the claimant after his meeting with Mr Corcoran. He told the Tribunal *89 that while he was the claimant’s manager he had not received any training in management skills nor had he contacted the human resources manager or any other person for advice as to how to deal with the claimant’s grievance.
It was the claimant’s evidence to the Tribunal that, rather than matters improving in the aftermath of the September 1999 meeting, they deteriorated to a point where the claimant felt ‘ambushed’ by the next event that occurred. The Tribunal was told that in October the claimant had been called to a meeting in Mr Fanning’s office, which meeting Mr Kealy and Ms Harris attended. She was informed at that meeting that changes were being made in the newsroom in which Mr Kealy would be assuming a more administrative role and that the claimant’s new boss would be Mr Corcoran. The claimant was queried as to her feelings about this. At that meeting the claimant advised the respondent that she did not have a problem working with Mr Corcoran. She told the Tribunal that she gave this response at the meeting because she believed that if she had not agreed she would end up being told to get out or to move somewhere else.
Mr Kealy’s evidence was that at the meeting with Mr Fanning the claimant did not present in any way as being under threat by the information that was being imparted.
Following this meeting Ms Allen continued to do her work as a crime correspondent, which work continued to be assigned to her by Mr Kealy. Her evidence was that her work environment did not improve and she continued to remain largely unacknowledged by Mr Corcoran and Mr Kealy. The Tribunal was told that at this point the work situation was affecting the claimant’s morale in that she found it difficult even to pick up the phone to her contacts.
On the evidence adduced, the Tribunal is satisfied that in September 1999, when the claimant spoke to her immediate manager Mr Kealy, her perception that she was being subjected over a period of time to a hostile working environment was not unreasonable. The Tribunal also concludes that the claimant’s belief by September 1999 that her position as crime correspondent was being undermined was not an unreasonable one. The Tribunal concludes that it was reasonable for the claimant to pursue these matters with the respondent.
We have come to our conclusion on the hostility issue for the following reasons. While specific incidents of hostility and or isolation were denied by Mr Kealy and Mr Corcoran it is common case that the claimant approached Mr Corcoran in August 1998 and Mr Kealy in September 1999 with such complaint. The Tribunal accepts that the claimant could hardly have initiated an approach to these persons without some factual basis for such a step. Moreover, the Tribunal also takes into consideration the unchallenged evidence of Andrew Hanlon, the claimant’s husband, who stated that in or about November 1998 he took it upon himself to speak to Mr Kealy about his concern that the claimant had been coming home from work in a state of distress on a number *90 of occasions. We are satisfied therefore that by September 1999 Mr Kealy was or ought to have been on alert, whether it would eventually be established as a matter of fact or otherwise, that the claimant’s perception of her working relationship with Mr Corcoran and with himself was an extremely negative one.
We have already stated that the claimant’s perception toward the end of 1999 that her job as crime correspondent was being undermined was not an unreasonable one and we so find because of the proximity in time between the claimant being offered and undertaking on a trial basis the job as ‘Keane Edge’ columnist and the claimant hearing about other journalists being recruited for jobs with the respondent newspaper. Furthermore, the Tribunal cannot disregard the proximity in time between the claimant ultimately declining the position as ‘Keane Edge’ columnist and the claimant’s receipt of a memo requesting her attendance at office meetings. In relation to this issue the Tribunal has paid particular regard to the evidence of the Mr Kevin Moore as to the intent behind the memo. We further accept her evidence that the respondent reacted negatively to her decision not to proceed with the ‘Keane Edge’ column.
It would appear that for the remainder of the year 1999 no further action was taken by Ms Allen regarding her grievances and it is the case that no one had reverted to her regarding the grievances outlined by her in September.
In evidence the claimant told the Tribunal that in January 2000 she spoke to Mr Kealy with a view to advising him that she intended to take in the spring of 2000 some 16 days leave due to her for the purposes of working on a book. Both Mr Kealy and the claimant agree that she was told to put her request in writing which she duly did in March 2000. On April 6 the claimant received a response in writing from Mr Kealy in which he took issue with the claimant’s ‘unprecedented accumulation’ of days off and moreover, wherein he advised the claimant that such accumulation must not happen again. In that letter Mr Kealy set out the work practices which the claimant was expected to adhere to and advised her that the working day was from 10 a.m. to 6 p.m. Tuesday to Friday and that she was required to be at her desk in the office by 10 a.m. on those days unless by prior arrangement with Mr Kealy. The claimant was further advised as follows: ‘failure to comply with this constitutes absence from work and will be recorded as such on the official attendance record’.
In her evidence to the Tribunal the claimant described her reaction to the letter. She viewed Mr Kealy’s reaction to the days off requested as completely at variance with what had been verbally agreed by the parties in January and she viewed Mr Kealy’s injunction regarding attendance at the office and the consequences if she defaulted as being completely confrontational and, moreover at variance with what had been agreed between the claimant and Mr Fanning, editor, at the commencement of her employment as to how she could carry out her work as crime correspondent. It was the claimant’s evidence that she had been given wide latitude by Mr Fanning as to how she could work as *91 crime correspondent, a latitude which was extended to all correspondents in the newspaper.
The claimant’s response to Mr Kealy was a letter written by her on April 7, 2000. Prior to sending this letter the claimant met off-site with Mr Moore, to discuss the contents of Mr Kealy’s letter. In her evidence to the Tribunal the claimant was unsure as to whether or not Mr Moore had sight of the letter the claimant had intended to send Mr Kealy. The Tribunal notes however that in his evidence Mr Moore confirmed that at this time the claimant made a complaint to him about being harassed by Mr Kealy and Mr Corcoran. The gist of Mr Moore’s evidence was that he took Ms Allen’s complaint seriously and was willing to process same. Mr Moore’s offer to process her complaint at this time is disputed by the claimant. The Tribunal notes Mr Moore’s evidence that while he himself did not observe hostility towards the claimant he did not consider her complaints to be frivolous at that time.
Following her meeting with Mr Moore the claimant sent her letter of April 7 to Mr Kealy. The contents of that letter has been read into the record of the Tribunal and it is not intended to set out same here. From the contents of that letter it is clear to the tribunal that on April 7, 2000 not only did the claimant take issue with what she saw as Mr Kealy’s about-turn on the holiday issue and what she saw as Mr Kealy’s attempt to change the terms and conditions of her job as a crime correspondent, but more importantly for the first time since her employment began, the claimant put in writing to her employer her complaints about the isolation and marginalisation she felt in the work environment. Furthermore the claimant advised Mr Kealy that she regarded the tone of his letter as evidence of the hostile attitude of which she was now complaining and in respect of which she had made a verbal complaint in 1999.
It is common case that shortly after sending this letter, the claimant had a meeting with Mr Kealy and both Ms Allen and Mr Kealy agreed in evidence that Mr Kealy apologised for his letter and told the claimant that he was in a ‘grumpy’ mood when he sent it. At this meeting Mr Kealy had requested the claimant to tear up the letter he had sent her and he had puported to throw the claimant’s letter of response into the litter bin. Mr Kealy was advised by the claimant that she wanted a written response to her letter from him. It is not disputed but that the claimant retrieved her letter from the bin and placed it back on Mr Kealy’s desk. Nor is it disputed that at this meeting the claimant refused to tear up or otherwise disregard Mr Kealy’s letter to her which letter had already being carbon copied to another work colleague by Mr Kealy. It was the claimant’s evidence that she requested a written response from Mr Kealy to her letter of complaint of April 7, 2000. We accept that she made such request of Mr Kealy and in this regard we note the contents of a memo written by Ms Allen to Mr Kealy in May 2000 reminding him that he had promised to respond to the issues the claimant had raised in her earlier correspondence. It is *92 common case that no written reply was sent to Ms Allen and in his evidence Mr Kealy’s explanation for this was twofold; he felt that he had already clarified the claimant’s position and moreover he was not willing to give the claimant ‘a charter’ (regarding her work hours) which would suggest the claimant was a free agent.
Having given careful consideration to the evidence of the parties, it is the view of the Tribunal that the unilateral decision taken by Mr Kealy after his meeting with the claimant in April 2000 to treat the issues raised by the claimant in her letter of April 7 as having being clarified was somewhat disingenuous. While it was certainly open to Mr Kealy to rescind the strictures he had put on the claimant’s work practices in his letter of April 6 it was not, in the view of the Tribunal, open to him, as the claimant’s immediate manager, to disregard the complaints regarding isolation and marginalisation at work reiterated by her in the letter of April 7, 2000. The Tribunal is satisfied on the evidence that from September 1999 the claimant continued to have cause for complaint in this regard.
The Tribunal notes the evidence of Declan Carlyle, human resources manager with the respondent who told the Tribunal that in April 2000 he had come in possession of the claimant’s letter to Mr Kealy of April 7. The claimant had sent a copy of this letter to the human resources division. Both Ms Allen and Mr Carlyle agree that the latter had approached Ms Allen about the memo and had stated he wished to speak to her. The claimant’s evidence is that she made a number of calls to Mr Carlyle seeking such a meeting but that he had not responded to her calls. Mr Carlyle’s evidence is that he had gone to Mr Kealy who told him that the matter had been resolved and to forget it. It is accepted by Mr Carlyle that at no point did he revert to Ms Allen after meeting Mr Kealy. In his evidence to the Tribunal, Mr Carlyle stated that as human resources manger his ‘antennae would have been up’ if he had heard mention of any bullying or harassment of the claimant in view of the fact that by mid—2000 he had participated in the formulation of an anti-bullying policy for the respondent. While Mr Carlyle agreed in cross-examination that references by the claimant to hostility, isolation and marginalisation in her letter of April 9 had nothing to do with leave, his evidence to the Tribunal was that he saw the claimant’s letter as just being about leave.
Having regard to the contents of the claimant’s letter of April 7, 2000 and having regard to the state of Mr Carlyle’s knowledge as to what or what not might constitute bullying or harassment its the work place, the Tribunal cannot accept as reasonable Mr Carlyle’s failure to revert to the claimant.
In the course of the hearing the claimant gave evidence of two meetings she initiated with Mr Fanning, editor, on May 10 and 17, 2000 respectively. It is Ms Allen’s evidence that she went to Mr Fanning because of the contents of Mr Kealy’s letter of April 6, 2000 and because of remarks made by Mr Kealy *93 to her regarding the level of her salary. The Tribunal has also heard the evidence of Mr Fanning regarding what transpired at these meetings. Mr Fanning does not dispute that at the May 10 meeting the claimant was making a complaint, which complaint he interpreted as the claimant querying her value to the paper. Mr Fanning agreed that he had been shown Mr Kealy’s letter of April 6 by Ms Allen. However, Mr Fanning disputes the claimant’s evidence that she showed him a copy of her reply of April 7. He further disputes that he had described the contents of Mr Kealy’s letter to the claimant as disgraceful. Mr Fanning gave evidence that at the May 17 meeting with Ms Allen, at which Ms Harris also attended she had made reference to Mr Corcoran whose negativity she maintained was contributing to her low morale. Mr Fanning’s evidence was that at this meeting he reassured the claimant about her value to the paper and the good stories she had worked on. Mr Fanning told the Tribunal that although at this time he felt that her performance rate had declined he did not communicate this to the claimant so as not to affect her morale. Mr Fanning had received complaints about the claimant’s performance rate from Mr Kealy but had not at any stage communicated those complaints to Ms Allen. Mr Fanning told the Tribunal that he had gone back to Mr Kealy with Ms Allen’s complaint and he had been told by Mr Kealy that the letter of April 6 had been withdrawn by him. He agreed under cross-examination that in all probability he did not revert to the claimant after speaking to Mr Kealy. He had felt matters had been resolved at this stage.
As already stated, in the course of this hearing a dispute arose between the parties as to whether or not by mid-May 2000, Mr Fanning had sight of the claimant’s letter of complaint of the 7 April to Mr Kealy. Mr Fanning is adamant that at no stage did he have this letter, seeing it only for the first time in the course of this hearing. The claimant however has stated that this letter was given to Mr Fanning when she gave him a copy of Mr Kealy’s letter. Mr Fanning has suggested that the reason the claimant would not have given him the letter was because of the reference in it to the agreement she says she had with Mr Fanning regarding work hours and work practices. In her letter the claimant had referred to Mr Fanning as agreeing with her on commencement that she could be ‘a free agent’ and that she could work from home and could operate independently as long as she completed her stories. It is Mr Fanning’s contention that the claimant would not have shown him a copy of this letter since the agreement referred to therein between himself and Ms Allen was not the one which had been agreed between them at the commencement of her employment.
On balance, the Tribunal is of the view that the claimant did produce a copy of her letter of April 7 at the May meetings. We so find for a number of reasons. Firstly, because the reason she went to Mr Fanning in the first place was to complain, inter alia, about the strictures being put on her work practices. *94 Secondly, by May 2000 the claimant had already given a copy of the letter to the human resources department and therefore who might see this letter thereafter was to some extent out of the control of the claimant herself. At this time it was entirely feasible that the letter could have gone to Mr Fanning via Mr Carlyle or Mr Kealy. That neither did so is not the relevant consideration. What the Tribunal considers relevant is that Ms Allen would have known that either Mr Kealy or Mr Carlyle could have shown the letter to Mr Fanning. Thirdly, the agreement on work practiced referred to in the claimant’s letter does not, in the Tribunal’s view, differ in any great respect from the account given by Mr Fanning himself of what was agreed between the parties at the outset of the claimant’s employment about how she could operate as crime correspondent. Mr Fanning’s evidence was that the claimant would be given ‘wide latitude’ and ‘a free hand’ to pursue her stories provide she delivered those stories. The tribunal also notes Mr Fanning’s evidence in reply to a question in cross-examination that the request from Mr Kealy for the claimant to be at her desk by 10 a.m. Tuesday to Friday was a significant change to what was agreed between Mr Fanning and Ms Allen when she took up employment with the respondent. Having regard to all these factors the Tribunal accepts that Ms Allen had been given considerable latitude by Mr Fanning regarding how she could operate as crime correspondent.
It was, in the Tribunal’s view, incumbent on Mr Fanning by May 2000 to make such an enquiry as was necessary about Ms Allen’s complaints given his state of knowledge at that time. This is particularly so in light of Mr Fanning’s then knowledge that the time when Mr Corcoran would become the claimant’s direct boss was imminent. His failure to pursue the matter and revert to her was something, in the view of the Tribunal, that could reasonably be taken into consideration by her at a later stage.
It is also clear from the evidence that notwithstanding the airing by the claimant of her grievances with Mr Kealy, Mr Fanning, Ms Harris and Mr Carlyle over the months of April and May 2000, the claimant had reason to re-state some of those grievances to Michael Roche, Group Managing Editor of the respondent paper, at a meeting she had with him in June 2000. It would appear that opportunity was taken by the claimant to do so following a request by Mr Roche that she meet with him to discuss aspects of her remuneration, in particular her expenses. In his evidence to the Tribunal Mr Roche agreed that the claimant when approached had indicated to him that she wished to discuss with him problems she was having with the respondent. It is clear that Mr Roche agreed to meet the claimant regarding these issues and ultimately a meeting was set up between the claimant, Mr Kealy and Mr Roche for June 29, 2000.
Between June 1 and 26, 2000 a number of other meetings took place between the claimant and Mr Roche where the parties renegotiated certain as *95 pects of the financial terms of the claimant’s contract of employment. Mr Roche agreed in evidence that some 12—months prior to this meeting the respondent had made changes to the claimant’s expenses agreement, to the detriment of the claimant and about which she was not happy and the series of meetings in June regarding expenses was to sort this matter out. It is submitted on behalf of the claimant in this case that as part of her case for constructive dismissal the claimant is entitled to rely on the changes that were made to her expenses agreement, in particular the removal of notional expenses and the capping of vouched expenses. It is also submitted that benefits such as foreign travel and free car insurance were unilaterally removed from the claimant’s contract of employment. The Tribunal has considered this aspect of the case and overall the Tribunal concludes that notwithstanding that the claimant had cause for complaint to Mr Roche in June 2000 as to the manner in which some of these issues were handled by the respondent, the Tribunal is satisfied that agreement on this aspect of the claimant’s employment was reached between the parties in June 2000 and therefore the Tribunal does not accept that this issue can form part of the claimant’s case for constructive dismissal.
The Tribunal has considered the evidence of the parties regarding what transpired at the meeting of June 29, 2000. The Tribunal is satisfied that the claimant made a complaint to Mr Roche about the atmosphere in the office, the hostility she was being subjected to and the fact that Mr Kealy had made reference to her salary within earshot of fellow workers. We are satisfied that no specific mention was made by Ms Allen of Mr Corcoran at this meeting. We are further satisfied that there was discussion among the parties about the claimant’s working hours and the attempts by the respondent, as the claimant saw it, to change the agreement she had with Mr Fanning. It is agreed by all relevant parties that that meeting ended with Ms Allen and Mr Kealy shaking hands and it is Ms Allen’s evidence that she was happy with the outcome of that meeting. While, at this hearing, there was disagreement between Ms Allen and Mr Roche as to what was being required of her regarding her attendance in the office, the Tribunal is satisfied to accept Ms Allen’s evidence that at the end of that meeting there was recognition by all concerned that she had to be allowed flexibility in her job as crime correspondent.
The Tribunal notes that in his direct evidence Mr Roche stated that at the meeting of June 29, no mention was made by Ms Allen of any deal she had with Mr Fanning regarding how she operated as crime correspondent. However, it is the view of the Tribunal that evidence of what Ms Allen was saying was her agreement was or ought to have been know, to Mr Roche on June 29 as copies of both Mr Kealy’s letter of April 6 and the claimant’s response of April 7, 2000 were given to him by Ms Allen in the course of the meeting. This he accepted in evidence while disputing Ms Allen’s counsel’s suggestion that he had received a copy of Ms Allen’s memo prior to this from Mr Carlyle.
*96
While the Tribunal notes Mr Roche’s very frank reply in cross-examination that he had not read Ms Allen’s memo in detail and had only glanced at it, it is the view of the Tribunal that, given that he had received this memo in the course of a meeting initiated by Ms Allen to discuss problems she was having in her workplace it was incumbent on Mr Roche to read same in view of the nature of the complaints being made.
In her evidence to the Tribunal, the claimant describes the next significant event in her working relationship with the respondent as occurring in August 2000. At this time a reporter, Mr Reilly was recruited by the respondent. In her evidence the claimant states that she had no difficulty with Mr Reilly being retained as a staff reporter but that she did begin to have cause for concern when he was assigned crime stories. In her evidence the claimant acknowledged that assigning crime stories to reporters other than crime correspondents was a feature of newspaper life but her concern was that stories were being taken away from her. The claimant gave evidence of Mr Kealy, in early September 2000, having assigned a particular story to Mr Reilly when he had specifically instructed the claimant to return from Donegal where she was working on another story to take up this assignment. The claimant’s evidence to the Tribunal is that she returned forthwith to be met with the fact that the story had by then been given to Mr Reilly. The claimant’s evidence is that when queried as to why this had happened, Mr Kealy’s response was that he ‘felt like it’. In his evidence to the Tribunal, Mr Kealy does not dispute that he telephoned Ms Allen regarding the particular story or that she returned the following day to work on same. However, Mr Kealy’s evidence to the Tribunal was that he gave the story to Mr Reilly on the basis that he could not be sure when Ms Allen would arrive back.
The Tribunal has considered the evidence of Mr Kealy and that of the claimant regarding this incident, an incident in respect of which the claimant in her evidence has set great store. Having regard to all the factors in this case it is the view of the Tribunal that the claimant was not unreasonable in viewing the reassignment of the story as a cause of concern to her and we do not view as unreasonable the claimant’s perception at this time that her job as crime correspondent was being undermined.
The Tribunal was told that on September 9, 2000, the claimant was advised by Mr Kealy to attend an office meeting scheduled for the September 12, the purpose of which was to officially welcome Mr Reilly to the news team as a reporter and to publicise the appointment of Mr Corcoran as assistant editor news. The claimant, Mr Kealy, Mr Corcoran and Mr Liam Collins gave evidence as to what transpired at that meeting. By and large there was no dispute as to what occurred and essentially at this meeting Mr Kealy officially welcomed Mr Reilly, made reference also to Mr Collins and latterly officially welcomed Mr Corcoran as assistant editor news. Conduct of the meeting was then *97 passed to Mr Corcoran. It is common case that Mr Corcoran scheduled a meeting of the news team for 10 a.m., the next morning.
In her evidence to the Tribunal the claimant outlined her reaction to the manner in which the meeting was conducted which meeting for all intents and purposes appears to be the trigger which led the claimant to seek a meeting with Mr Roche, which took place the following day. In the course of her evidence to the Tribunal, the claimant described herself as the ‘invisible person’ at this meeting with her work colleagues and her now new boss Mr Corcoran. The Tribunal accepts as credible Ms Allen’s evidence as to how she perceived that meeting.
The respondent witnesses have stated in evidence that since nothing had changed regarding the claimant’s status on September 12 there was no need to specifically address the claimant or acknowledge her presence.
The claimant perceived what went on as an example of the isolation and hostility about which she previously complained. Was the claimant’s perception a reasonable one in the circumstances? We find that it was. We do so for the following reasons. While we accept that Ms Allen’s status had not changed it is the case that from the September 12 her working relationship with Mr Corcoran was now different. She would now be reporting to him as deputy news editor. Had not Ms Allen complained previously about her perception of a hostile working environment, the manner in which the meeting of September 12 was conducted might not in itself have been significant but, taking place as it did against a background of complaints made by the claimant about isolation and marginalisation her perception of that meeting was not an unreasonable one in all the circumstances.
The Tribunal also finds that in the circumstances it was not an unreasonable belief on her part that once again strictures were being put on how she did her work. Whether this was the intention or not is not the issue. The claimant was not unreasonable in viewing it as such in light of the earlier events of September 1999 and April 2000 and in light of the fact (as supported by Mr Kealy’s own evidence), that the request to the claimant to attend 10 a.m. meetings had been abandoned for a number of months prior to September 2000.
The respondent witnesses have given evidence that they perceived no sign of distress at this meeting. Whatever the demeanour of the claimant at that meeting it is clear from the evidence of her doctor whom she attended on September 9 and indeed from the evidence of Mr Roche who met her on September 13 that the claimant was in considerable distress in September 2000. Prior to the meeting of September 12 the claimant had consulted with her general practitioner, Dr Malone, and the symptoms with which the claimant had presented on that date namely sleeplessness, palpitation, nervousness, headaches, poor appetite are not disputed. Dr Malone was advised by the claimant that her difficulties related to her work situation and in evidence his medical opinion *98 was that it was her work situation that had caused her health difficulties. We are satisfied, on the claimant’s evidence, that her work environment was causing over a period of time the concentration difficulties and loss of confidence she complained of.
On the evidence adduced in this case, the Tribunal is satisfied that the situation that pertained in the claimant’s work environment necessitated medical intervention and prompted her to again seek a meeting with Mr Roche, group managing editor of the respondent.
The Tribunal has heard evidence of the meeting of September 13 which took place between Ms Allen and Mr Roche and which the claimant’s husband attended. By and large, no great dispute arises about what Ms Allen complained of at that meeting. We are satisfied that she outlined to Mr Roche the problems she said continued to exist in the workplace culminating in the isolation she said she experienced on September 12. We are satisfied that she informed Mr Roche of her belief that crime stories had been taken away from her, and of her concern that the clarification she believed she had after the June 2000 meeting regarding her work hours was again being undermined by the reintroduction by Mr Corcoran of 10.30 a.m. meetings. She complained also of what she perceived to be dismissive remarks made by Mr Corcoran in public regarding the job of crime reporting. She outlined her concern at another reference by Mr Kealy in September 2000, to her being one of the highest paid members of staff which reference according to the claimant was made in front of work colleagues. While Mr Kealy in evidence has set out the context in which he says reference to her salary came about the Tribunal is inclined to favour the claimant’s evidence in this regard. The Tribunal accepts that the respondent witnesses at this Tribunal disputed the matters in respect of which the claimant made complaint to Mr Roche but on balance the Tribunal accepts that the claimant had cause for complaint at this time. We note that while Mr Roche himself sought to address some of the claimant’s issues in the course of the meeting of September 13, it is not in any way disputed by him that the claimant was extremely distraught throughout the meeting and that she cried for a period of one hour and 50 minutes of that two-hour period. Mr Roche’s view of the issues being raised by the claimant were that they were serious allegations which merited investigation indeed, Mr Roche agreed with the claimant’s evidence that at the meeting, after hearing what she had to say, he advised her on a number of options open to her namely that she should consider moving, resigning, or going to the union and making an official complaint. Mr Roche also agreed that he told Ms Allen that she could consider taking a case for constructive dismissal though he disputes her evidence that he said to her she would probably win such a case.
Mr Roche has also stated that he told the claimant he would hold a series of meeting with the union and human resources and he would do it quickly. This *99 was, in his words, to show Ms Allen that the respondent was prepared to act on her complaints.
It is common case that initially the claimant stated at the meeting that she was reluctant to go to any such meetings but she had been persuaded both by her husband and Mr Roche that she would have to attend at such investigation. It was the claimant’s evidence that when her meeting with Mr Roche concluded her understanding was that she would be contacted by him to attend a meeting with all concerned. We accept her evidence in this regard.
Ms Allen gave evidence to the Tribunal of a telephone conversation she had with Mr Roche some three hours after meeting him when he informed her that he had spoken to all parties concerned but was not going to tell her what they said save that Mr Fanning and Ms Harris had been “flabbergasted” to hear of the claimant’s complaints.
Ms Allen told the Tribunal that her reaction to this information was one of disbelief in view of the fact that both Mr Fanning and Mr Harris had previously been made aware by her of the difficulties she was encountering in the workplace. It was Ms Allen’s evidence that Mr Roche advised her to talk to Mr Fanning and Ms Harris and that she would feel better for this. The claimant’s evidence was that she told Mr Roche that she would call him back once she had discussed the matter with her husband. The Tribunal was told that before doing so the claimant received a telephone message from Mr Fanning to the effect that he had talked to Mr Roche and that he was sorry she was having a hard time. Mr Fanning had offered her a trip abroad and had stated that he wished to meet her with Ms Harris the following morning at a café in Blackrock.
The Tribunal was told that following receipt of this message the claimant telephoned Mr Roche and advised him she was extremely unhappy with any suggestion that she go back to people (Mr Fanning and Ms Harris) who the claimant believed had already neglected to deal with her grievances.
In his evidence Mr Roche stated that he saw the meeting with Mr Fanning and Ms Harris as a preliminary one and that he planned to be in attendance at such meeting and planned further investigation thereafter which would include, as already stated, the NUJ and the head of human resources. He disputed Ms Allen’s evidence that she had told him of her objection to meeting Mr Fanning and Ms Harris. On balance, we accept that Ms Allen did relay her objection to Mr Roche.
In relation to the proposed Blackrock cafè meeting, the Tribunal has had the benefit of hearing from Mr Fanning and Ms Harris as to what was proposed. Mr Fanning’s evidence was that, after being told by Mr Roche of the claimant’s complaints and of her distraught state, he took ‘a solo initiative’ to meet Ms Allen and communicated that request to her by telephone. He agreed he offered her a trip abroad. Ms Harris in her evidence agreed with Mr Fanning that the meeting he was offering was to be a meeting ‘independent’ of the *100 investigative process.
The Tribunal has considered the evidence of all relevant witnesses regarding the events of September 13 and the Tribunal finds that there is conflict in the evidence of the respondent witnesses as to what was the purpose of and who was to attend the Blackrock café meeting. The Tribunal notes that no mention of Mr Roche’s intended presence at that meeting was made by either Mr Fanning or Ms Harris in the course of their evidence. Mr Roche in his evidence stated that he had such intentions. It is the claimant’s evidence that her understanding of the message received on Friday, September 13 was that what was being offered was purely a meeting with Mr Fanning and Ms Harris.
The acceptance or otherwise of Ms Allen’s understanding of this matter by the Tribunal is important having regard to the fact that her understanding was ultimately one of the factors which led her to resign her employment on September 20, 2000.
Having given careful consideration to the evidence of the relevant witnesses the Tribunal accepts as reasonable the claimant’s belief that the meeting proposed for the following day was only to be with Mr Fanning and Ms Harris.
It is the claimant’s contention that this meeting with Mr Fanning, about whose ability to deal with her problems she had severe reservations, in light of his failure to deal with her previous complaints, was to be the extent of the respondent’s investigation into her grievances. The question for the Tribunal is whether this was a reasonably held belief on her part. Having carefully deliberated on all of the evidence in this case, it is the finding of the Tribunal that this was not an unreasonable assumption on her part.
In arriving at this finding the Tribunal has taken into consideration the very fact that telephone calls were made to Ms Allen at all on the evening of September 13. It is the view of the Tribunal that a reasonable response from the respondent, after Ms Allen’s meeting with Mr Roche, would have been written communication to her advising her that an investigation would commence and advising her of the dates of any proposed meetings. The Tribunal also considers it significant, notwithstanding the claimant’s refusal to meet Mr Fanning, communicated to Mr Roche on September 13, 2000, that from that date to September 20, no written communication was made with the claimant even acknowledging that she had made complaints of such nature that, in Mr Roche’s evidence, merited investigation by him. In all the circumstances of this case the Tribunal accepts as not unreasonable the claimant’s belief that she could have no confidence in the respondent to address the complaints she had made.
The Tribunal also considers it surprising that Ms Allen was being offered on September 13 a trip abroad at a time when the respondent knew of the claimant’s distraught state and at a time when part of the advice being given to her by Mr Roche was that she take sick leave.
By letter dated September 20, the claimant advised Mr Fanning that she *101 was resigning her employment and claiming constructive dismissal.
The issue for the Tribunal is whether Ms Allen was dismissed by construction under the definition of dismissal under section 1(b) of the Unfair Dismissal Act 1977, which provides as follows:
… the termination by the employee of his contract of employment with his employer, whether prior notice of termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of termination to the employer.
Having regard to the aforementioned definition and to the evidence and submissions the Tribunal deems the proper test in this case is whether it was reasonable for Ms Allen to terminate her contract of employment.
Having given careful consideration to the evidence adduced and the submissions made on behalf of the parties and having regard to the various findings and conclusions arrived at by this Tribunal, as already outlined in this determination, it is the unanimous view of the Tribunal that it was reasonable in all the circumstances for the claimant to terminate her contract of employment.
Mr Connaughton BL, on behalf of the respondent, has submitted, inter alia, that it was incumbent on the claimant before resigning to utilise the NUJ grievance procedures. The objective of utilising the NUJ grievance procedure would have been to bring the claimant’s grievances to the attention of the respondent. The Tribunal is however satisfied that at various stages throughout her employment and more particularly in September 2000 Ms Allen brought her complaints to senior management level within the respondent newspaper. We also note Mr Moore’s evidence in cross-examination that an employee’s grievance could be processed by either going to the union or directly to management.
Mr Connaughton also submits that the claimant cannot rely on any matter prior to June 29, 2000 as grounds for resigning her employment on the basis that the claimant, in her own evidence, expressed herself happy with the outcome of June 29, 2000 meeting at which she had outlined her grievances.
The Tribunal rejects this argument and does so having regard to the various findings and conclusions arrived at by the Tribunal as set out in this determination. The Tribunal considers it reasonable for the claimant to have taken into consideration the manner in which her various complaints were dealt with from 1999 through to 2000 in arriving at her conclusion that she had essentially lost faith in what was being offered by way of investigation by the respondent in September 2000. She was entitled to do so because we accept that she had cause for complaint after June 2000. The Tribunal therefore finds the claimant’s conclusion that she could have no confidence in the respondent to either *102 properly or effectively address her grievances was a reasonable conclusion in all the circumstances. Moreover, the claimant did not act unreasonably in taking into consideration the likely effect on her health and well-being were she to remain in the work environment. In assessing the reasonableness of her decision in this regard the Tribunal accepts that the effect on her health and well-being was a concern she had prior to her resignation, a concern that had been communicated to the respondent in September 1999.
Accordingly, the Tribunal unanimously finds the claimant to have been constructively dismissed and as no evidence has been offered to rebut the presumption of unfairness the Tribunal determines the claimant was unfairly dismissed for the purposes of the Unfair Dismissals Act 1977 to 1993. We do not find that the claimant contributed in any way to her dismissal.
Having found the claimant to have been unfairly dismissed the Tribunal must now address the issue of remedy. In his closing submission to the Tribunal, Mr Mallon BL on behalf of the claimant has argued that re-employment in any form is not a feasible option in this case having regard to the circumstances which led the claimant to terminate her contract of employment. Having regard to the matters in issue in this case the Tribunal accepts that neither re-instatement nor re-engagement is a suitable remedy in all the circumstances.
The preferred redress of the claimant is compensation. Both parties agree that since dismissal the claimant has been unfit for work by reason of illness. It is submitted on behalf of the claimant that the reason that she has been and remains unfit for work is due to the conduct of the respondent which conduct, it is submitted, has not only led to the, claimant’s constructive dismissal but also directly to the claimant’s illness.
It is submitted, on behalf of the respondent in its written submissions that the Tribunal, in the event of it finding that the claimant was unfairly dismissed, should reject the arguments being advanced on behalf of the claimant and hold that no financial loss has been suffered by her.
In this regard a number of matters arise for the Tribunal to determine. Firstly, we must determine, either as a matter of fact or probability, whether the matters of which the claimant complains led to her resignation led also to her illness. While as between the medical experts called on behalf of the claimant and the respondent there is dispute as to the nature of the claimant’s illness both experts agree that conduct such as that complained of by the claimant can lead to illness. Dr Brophy is of the opinion that the claimant is suffering from a depressive illness occurring in the context of work-related difficulties. The Tribunal also notes the evidence of Professor Casey who gave evidence on behalf of the respondent. She disputes Dr Brophy’s diagnosis of depressive illness and states that the claimant is suffering from an adjustment reaction or stress reaction. However, Professor Casey has stated in direct evidence to the Tribunal that bullying, harassment and intimidation in the work place can lead to the *103 symptoms with which the claimant is presenting. Dr Malone who saw the claimant on September 9 and 5, 2000, stated in evidence that he attributed the symptoms with which the claimant was presenting to work-related difficulties and he had not ascertained any other cause for the claimant’s medical condition other than her work environment.
Nowhere in the course of this hearing has the respondent put forward an alternative explanation for the claimant’s illness.
On the basis of the findings already made as to what led the claimant to resign her employment with the respondent and on the basis of the medical evidence before the Tribunal, we are satisfied that the claimant’s illness was caused by the factors which led to her constructive dismissal.
It is submitted on behalf of the claimant that in these circumstances she is entitled to be compensated for the financial loss suffered by her to date and for financial loss into the future having regard to the evidence of her medical expert.
The jurisdiction of the Tribunal to make an award of compensation is set out in section 7(1)(c)(i) of the Act which provides as follows:
if the employee incurred any financial loss attributable to the dismissal, payment to him by the employer of such compensation in respect of the loss (not exceeding in amount 104 weeks remuneration in respect of the employment from which he was dismissed calculated in accordance with regulations under section 17 of this Act) as is just and equitable having regard to all the circumstances.
Section 7(2) of the Act goes on to provide a number of factors that must be taken into consideration in determining the amount of compensation payable. One of the factors that shall be taken into account is the extent to which any financial loss incurred was ‘attributable to an act, omission or conduct by or on behalf of the employer’.
Financial loss is defined in section 7(3) as:
… any actual loss and any estimated prospective loss of income attributable to the dismissal and the value of any loss or diminution, attributable to the dismissal, of the rights of the employee under the Redundancy Payments Acts 1967 to 1991 or in relation to superannuation;
‘remuneration’ includes allowances in the nature of pay and benefits in lieu of or in addition to pay.
It is submitted on behalf of the claimant that in the circumstances of this case, section 7(1)(c)(i) of the Act must be read in conjunction with section 7(2)(a). It is argued on behalf of the claimant that the import of these two provisions is that the Tribunal can compensate the claimant for the financial loss she has suffered to date and for financial loss into the future.
*104
Counsel for both parties say they can find no Irish authority dealing specifically with the jurisdiction of the Tribunal to make an award of compensation in circumstances where an employee is unavailable for work due to illness attributable to the conduct or actions of the employer.
However, counsel for the claimant has referred the Tribunal to a number of court decisions in particular the decision of the Supreme Court in Martina Carney v. Balkan Tours Ltd [1997] 1 IR 153 and two decisions of the English Employment Appeals Tribunal namely Devine v. Designer Flowers Wholesale Florist Sundries Ltd [1993] IRLR 517 and Hilton International Hotels (UK) Ltd v. Faraji [1994] IRLR 265.
While it is agreed by the claimant’s representative that the English decisions can only be of persuasive authority, reliance is placed on these decisions because of the similarity of section 74(1) of the Employment Protection (Consolidation) Act 1978 to the provisions of section 7 of the Unfair Dismissals Act 1977 to 1993.
The headnote from Devine illustrates the approach taken by the English EAT:
The EAT held … an employee who has become unfit for work wholly or partly as a result of an unfair dismissal is entitled to compensation for loss of earnings for at least a reasonable period following the dismissal, until she might reasonably have been expected to find other employment. The Industrial Tribunal must have regard to the loss sustained by the employee, consider how far it is attributable to action taken by the employer, and arrive at a sum, which it considers just and equitable. There is no reason why the personal circumstances of the employee, including the effect of dismissal on her health should not be taken into account in ascertaining the appropriate amount of compensation. However the employee will not necessarily be entitled to loss of earnings for the whole period of unfitness for work. The fact that unfitness followed upon and was attributable to the dismissal does not perforce imply the whole period of unfitness thereupon must be attributable to the actions of the employer. There may be questions, for example, as to whether the unfitness might have manifested itself in any event.
In the case of Hilton International Hotels the English EAT has held that the Industrial Tribunal had not erred in finding that the unfairly dismissed employee was entitled to a compensatory award for loss of earnings notwithstanding that he was in receipt of invalidity benefit during the relevant period. The EAT held that the Industrial Tribunal was entitled to look behind the payment of the benefit, enquire what is the nature of the disability and decide whether same was attributable to the activity of the employer in unfairly dismissing the employee.
Much reliance is also placed by counsel for the claimant on the dicta of the Supreme Court in Carney. In that case the Supreme Court had to decide whether this Tribunal was entitled to have regard to the appellant employee’s contribu *105 tion to her dismissal as one of the relevant circumstances in determining the amount of compensation to be paid to the unfairly dismissed employee. In like manner to section 7(2) (a) of the Unfair Dismissals Act 1977, section 7(2)(b) thereof provides that in determining the amount of compensation payable under section 7, regard shall be had to ‘the extent (if any) to which the said financial loss was attributable to an action, omission or conduct by or on behalf of the employee’.
The Supreme Court confirmed the entitlement of this Tribunal to take into consideration the conduct of the employee prior to dismissal in assessing the level of compensation to be paid.
In support of the arguments regarding financial loss being made on behalf of the claimant in this case, counsel had referred the Tribunal to the judgment of Murphy J and in particular to the following passage from that judgment.
It does seem to me that the discretion conferred upon the Tribunal (or adjudicating body) by s. 7 of the Act of 1977, in relation to the computation of a payment by way of compensation is very wide. Moreover, whilst the specific directives given to the adjudicating body by paras (a) and (b) and more particularly, (c) (dealing with mitigation) may be interpreted as referring to events subsequent to the dismissal the provisions of para. (d) of subs. 2 unquestionably refer to the machinery, which was or should have been resorted to in relation to the dismissal rather than event subsequent thereto. That provision coupled with the discretion conferred upon the adjudicating Tribunal in the widest terms would seem to me compelling reason for inferring the legislature intended that the body determining the nature or extent of the redress to which the employee was entitled should look at all of the circumstances of the case including the conduct of the parties prior to the dismissal. I am fortified in this view by the judgment of Ellis J in McCabe v. Lisney and Son [1981] ILRM 289 and the jurisprudence which has evolved based thereon. The fact that the legislature in 1993, made express provision in that regard must in the circumstances be interpreted as a provision made ex abundante cautela and to avoid the doubts which might well and, indeed, have arisen in the circumstances.
Having regard to the Supreme Court’s interpretation of what was intended by the legislature in section 7(1)(c)(i) and section 7(2) of the Unfair Dismissals Act 1977, the Tribunal is satisfied that, in the circumstances of the present case, it must consider the extent to which the claimant’s financial loss is attributable to any act or omission or conduct by or on behalf of the respondent prior to dismissal.
While in no way binding on this Tribunal we are also satisfied to accept as persuasive the English EAT decision in Devine.
We have already set out our findings regarding the cause of the claimant’s illness in this case. We are satisfied that her illness is attributable wholly to the factors which led her to resign her employment and claim constructive dis *106 missal. Her illness had led to her financial loss. Having regard to the series of findings made by this Tribunal it follows that the Tribunal must hold that the claimant’s financial loss is attributable to the conduct of the respondent. To hold otherwise, in light of the findings made, would in the view of this Tribunal, have the effect of leaving an unfairly dismissed employee (where re-instatement or re-engagement have been ruled out as unsuitable remedies) without any effective remedy for the financial loss suffered as a result of the dismissal. Such a result would in our view be contrary to the intention and spirit of section 7 of the Unfair Dismissals Act 1977.
The Tribunal must now assess the extent of the financial loss suffered by the claimant. It is clear that she is unable to work since her dismissal and at the time of this hearing she remains unfit for work. We are satisfied that she has sustained financial loss to date. There is dispute between the parties’ medical experts not just in relation to the nature of the claimant’s illness, but also the likely duration of same. We have considered the evidence of the medical witnesses and overall the Tribunal accepts on balance the evidence of Dr Brophy as to diagnosis and the prognosis for recovery. In his evidence given on February 6, 2001 he envisaged from that time a period of recovery of some 18 months. The Tribunal estimates therefore, that because of her illness, the claimant will suffer financial loss for a period of almost two years from the date of dismissal. The Tribunal also accepts as not unreasonable the submission made on behalf of the claimant that, following recovery (even allowing for some earlier element of recovery) a period of time will elapse before she will achieve a salary commensurate with that of her pre-dismissal earnings. The Tribunal assesses as reasonable, following recovery, that it will take a period of at least a year for the claimant to achieve similar earnings. We accept therefore that she will incur financial loss in this period.
No specific figure was given in respect of the claimant’s net weekly loss as a result of her dismissal. A figure of £903.85 per week has been given in the T1A in respect of her weekly gross earnings which figure is indicative of the agreed yearly salary of £47,000 she was on at the time of dismissal. The Tribunal therefore estimates in all probability her average weekly net loss to be in the region of £500 per week. We accept she will have ongoing loss for the period she remains unfit for work and until she achieves similar employment.
In all the circumstances therefore, having regard to her loss to date and the time-frame accepted by the Tribunal for future loss we deem as just and equitable that the claimant be awarded compensation in the sum of £70,500.30 being the equivalent of 78 weeks remuneration (78 × £903.85) for unfair dismissal.
Mark Harrold (claimant) v St Michael’s House (respondent)
(UD 1123/2004)
Employment Appeals Tribunal
29 January 2007
[2008] 19 E.L.R. 1
(January 29, 2007)
[2008] E.L.R. 1
Subject: Employment
Keywords: Bullying; Constructive dismissal; Grievance procedures; Resignation
Constructive dismissal—Workplace bullying and harassment—Report by claimant in relation to staff and client treatment—Employee resignation in circumstances where employee dissatisfied with response—Duty of employee to invoke employer’s grievance procedures—Duty to engage with said procedures—Employee’s consistent failure to so engage in the employer’s grievance procedures— Unfair Dismissals Acts 1977(No. 10) to 2001 (No. 45)
Facts
The claimant commenced employment with the respondent in March 1991 as a psychologist. In 2001, the claimant stated that he experienced difficulties with the respondent. In a letter to the chairperson of the Board he expressed concern about the culture of bullying within the organisation and referred in particular to the bullying of a long-standing staff member who had left the respondent organisation. The chairperson of the board advised the claimant to engage in the respondent’s internal grievance procedure in order to have his concerns addressed. Three individuals were nominated to conduct the internal grievance procedure; however, the claimant maintained that two of these individuals had been involved in the bullying of the staff member to whom the claimant had referred when expressing his concerns about the climate of bullying. The claimant therefore stated that while he would engage in the process he would not do so with those two individuals: the persons hearing his grievances would need to be independent.
The claimant was threatened with disciplinary action by the respondent if he did not co-operate with the internal grievance procedure. The respondent’s solicitors then wrote to the claimant outlining a formula for an investigative sub-committee of the board; however, the claimant objected to the presence of a member of the committee on the grounds of his being a friend of the chief executive officer, contending that an objective investigation could not be guaranteed. In or around December 2002, the board wrote to the claimant informing him that because he had not co-operated with either of the respondent’s procedures the case was now closed. The claimant responded that the case was not satisfactorily or at all resolved and he would now have to deal with the matter outside the respondent. Accordingly, in June 2003 he wrote to the Minister for Health highlighting his concerns; the Minister in turn organised for the Eastern Regional Health Authority to set up an investigation. In October 2003, the investigation resulted in the investigator telling the claimant that he had not co-operated with the procedure.
In or around July 2003, approximately one month after he had written to the Minister, the claimant received a letter from the respondent informing him of a number of concerns the respondent had in relation to his performance and *2 conduct. The claimant maintained that after he wrote to the Minister a campaign was waged by the respondent to damage his reputation and to place him under pressure that he would not be able to endure. A meeting was held where the claimant outlined how all of the eight allegations concerning the claimant’s conduct and performance were entirely spurious and an attempt to undermine his integrity. The claimant did not receive any communication from the respondent as to the status of the investigation or any reply to the outcome of concerns he raised in a letter to the respondent in or around November 2003. The claimant ultimately resigned in March 2004 as he felt he had exhausted all avenues of communication and did not have anywhere left to go with the issues of bullying; yet the issues still remained unaddressed by the respondent and he argued that he was being targeted for having raised these issues.
Determined
by the Employment Appeals Tribunal in finding that the claimant was not constructively dismissed:
(1) That the task for the Tribunal in a constructive dismissal claim was to evaluate the evidence heard by it so as to ascertain whether the claimant had established a factual situation sufficient to bring him within the legal parameters for constructive dismissal. The legal context of the claimant’s case as to whether he was constructively dismissed by the respondent, in circumstances caused by alleged persistent and sustained bullying and harassment, was not in dispute between the parties. It was agreed that the onus was on the claimant to prove his case; that the definition in law of bullying was that contained in the Industrial Relations Act 1990 (Code of Practice detailing Procedures for Addressing Bullying in the Workplace) (Declaration) Order 2002 (S.I. No. 17 of 2002) and that the test for the claimant to satisfy was whether it was reasonable for him to terminate his contract.
(2) That the totality of the evidence produced by the claimant, his fellow employees and other relevant witnesses outside the employment nexus did not establish the existence of bullying within the respondent organisation. Having regard to the claimant’s own evidence the Tribunal found that the claimant did not act reasonably in refusing to engage with the two processes made available to it by the respondent. Furthermore, it was significant that if the claimant considered the outcome of the internal managerial enquiry unsatisfactory there was a right of appeal to a Rights Commissioner or the Labour Relations Commission. The claimant’s evidence as to when he himself felt personally bullied by the respondent was based on the meetings in July 2003 and the events thereafter. The Tribunal found that the respondent had acted reasonably in and around this time and that the claimant’s behaviour, subsequent to September 2003, exhibited a lack of engagement by him with the processes available to him within the respondent’s organisation to deal with his complaints.
(3) That the claimant’s consistent lack of engagement with the respondent’s *3 grievance procedures meant that he acted unreasonably in terminating his employment contract with the respondent; and accordingly his claim for constructive dismissal failed.
Cases referred to in the determination
Allen v Independent Newspapers (Ireland) Ltd [2002] E.L.R. 84
The full text of the determination of the Tribunal was as follows:
Background
Counsel for the claimant in an opening statement told the Tribunal that there was a culture of bullying and harassment in the respondent company in circumstances in which it related to the claimant’s ability to carry out his job. He outlined to the Tribunal that eight witnesses would give evidence on behalf of the claimant: a senior social worker, a care worker, a general practitioner, a step-brother of a former patient in the respondent, a former relative who was also a social worker with the respondent and a character witness. The claimant had a good working relationship with the respondent until around the year 2001. The claimant communicated with the Minister for Health regarding a draft report, which was prepared around 2003. He highlighted what he thought were the deficiencies in relation to the content of the report.
Claimant’s case
The claimant told the Tribunal that he graduated with a BA Honours in Psychology from UCD in 1983. He had a Masters in Clinical Psychology from UCD in 1984, a Masters from Southern Illinois University, USA in 1987. He obtained a PhD in June 1990 from the California School of Professional Psychology Los Angeles. He commenced employment with the respondent on March 5, 1991. During his tenure with the respondent he co-wrote a staff training programme on challenging behaviour and how to deal with difficult behaviour of individuals with learning disabilities. Prior to that he had been involved in a research project, which was assessing the nature of challenging behaviour, on which he had written numerous articles.
One of the most enjoyable aspects of his job was supervising a one-week holiday camp in Brittas Bay, which was a very different aspect to his work but he thoroughly enjoyed it and it grounded him in the kind of work that he was involved in. For many years he was the nominated disc jockey at the holiday camp. That was a highly enjoyable experience for him and completely different from the more formal or academic background that he had. He endeavoured to strike a balance between looking at the broader picture and the human side of the service that the respondent was supposed to provide.
The claimant stated that he experienced difficulties around 2001. He wrote to *4 the chairperson of the board, as he was horrified at the circumstances of the death of a client of the respondent Mr P McK. He wrote a letter to the board in which he expressed concern about the culture of bullying within the organisation. There had been some instances and one in particular where a long-standing staff member of 23 years he believed was treated in a very unfair fashion, which ended up with him leaving the organisation. The claimant personally expressed his concern about this to the CEO of the organisation on a number of occasions. A patient Mr PMcK was sent to a nursing home against his family’s wishes. There had been a catalogue of complaints about the nursing home prior to the client being sent there. The family of Mr PMcK was brought to the High Court compelling them to send him to the nursing home. The High Court was informed by a number of senior people from the respondent that there had never been any complaint about the nursing home. He was not aware of the full circumstances of the death of the client at the time. He wrote an article in a national newspaper in which he used the words, “we dump them into nursing homes” . Following that the family of Mr McK contacted him and it was at this point that the claimant said he was no longer prepared to work in an organisation that treated a family in this fashion and that he was going to do anything that he possibly could to address or redress this situation as a professional. The claimant highlighted his concerns; he had done this on a number of occasions about the use of nursing homes as being very inappropriate places for people with learning disabilities. The CEO Mr PL asked him to give him an alternative and the claimant told Mr PL that using a gym in the local school with 20 beds would be better than sending them to a nursing home because they would at least have the respondent’s staff.
The claimant was unhappy that a man, in relation to a long-standing staff member, for 23 years a very dedicated member of staff, was embroiled in what the claimant subsequently realised was a fairly standard procedure. The claimant raised this matter with the CEO on the administrative level. His immediate manager was Mr MM and the claimant spoke to him. Mr MM was sympathetic to his concerns but he did not seem to be in a position to do anything substantial about it. The claimant wrote to the board on September 3, 2001 outlining his concerns. The chairperson of the board Ms S replied to him and informed him that he needed in the first instance to engage in the internal grievance procedures within the respondent. Three individuals were nominated to the internal grievance procedure. The claimant maintained that two of these gentlemen had been involved in the bullying of the staff member who had left, the one that he was particularly concerned about. The claimant replied that while he maintained that he would still be willing to engage with the process he would not engage in the process with those two individuals. The people that were investigating his legitimate complaint would need to be independent. That form of internal grievance was not proceeded with. It became clear to the claimant at that point that perhaps it was not appropriate to engage in an internal grievance procedure *5 because he did not have a personal grievance. He wrote to the board initially about the culture of bullying. He commented in his original letter to the board that he had spoken up and he realised he was now likely to become a target of this bullying.
During that time he was threatened with disciplinary action if he did not co-operate with the internal grievance procedure. He received a letter from the CEO. Mr PL and the claimant’s recollection of the letter was that if he did not co-operate with the legitimate internal grievance procedure of the respondent and if he took his grievance outside of the respondent’s remit without engaging in that first then he would be subjected to disciplinary action. Even though his request was not a standard grievance procedure, he highlighted issues not to do with him but issues to do with the direction that the respondent was taking and he highlighted the fact that this process did not seem to be appropriate to address those concerns that he had sent to the board.
He then received a letter from the respondent solicitors in which they outlined that they were now going to formulate an investigative sub committee of the board. The claimant’s response to this was that he felt that the presence of Mr R on that committee would not render it objective. His reason for stating that was that Mr R had business ties with the respondent. Mr R’s company supplied various domestic supplies to the respondent and the claimant was aware that Mr R was a friend of the CEO Mr L. Again the claimant highlighted the fact that these issues were too serious to be treated in a manner where he would not get an objective investigation.
He was not sure if the board wrote to him in December 2002 or January 2003 informing him that because he had not co-operated with either of the procedures within the respondent the case was now concluded. The claimant responded that the case was not concluded and that he would now have to deal with the matter outside the respondent. He wrote to the board and told them that the matter was definitely not concluded and that he would take it outside of the respondent and that prompted him in June 2003 to write to the Minister for Health highlighting his concerns and he enclosed his original letter to the board. The claimant received a reply stating the matter was being passed over to the ERHA for them to set up an investigation. He was subsequently informed that Mr MH was investigating his complaints and Mr MH wrote to the claimant. The claimant met with Mr MH on September 24 in an off-site location for an initial meeting. At this meeting he highlighted his concerns to Mr MH. The claimant and Mr MH arranged to meet so that the claimant could give Mr MH a formal response on October 10. The claimant asked him before the meeting commenced if he had met the family of Mr PMcK who had died and he responded no. The claimant asked him if he would be meeting with the family of Mr PMcK and Mr MH responded no. The claimant told Mr MH that he would have nothing more to say to him because it was not an objective investigation. Mr MH subsequently prepared a document, *6 which was furnished to the claimant in October 2003. Mr MH told the claimant that he had not co-operated with the procedure. The claimant wrote to either the Minister or the CEO Mr L, who sent him the report of the ERHA, at the time highlighting the deficiencies in Mr MH’s report, primarily the fact that he did not interview the family of Mr PMcK. Mr MH did not report his contacts with the staff member who the claimant had highlighted in his original letter to the Board; he did not interview key clinicians who had difficulties with the treatment of Mr PMcK at the time he was sent to the nursing home.
The claimant received a letter from the respondent on July 17, 2003 approximately one month after he had written to the Minister for Health, informing him that there were a number of concerns in relation to his performance and conduct. Eight allegations were levelled against the claimant. One was that the claimant was a member of St Joseph’s Parents and Friends Association of St Ita’s. St Ita’s had no connection with the respondent. The claimant participated in that committee in his own time because he was extremely concerned about the incarceration of vulnerable people in the most appalling circumstances and he highlighted this on numerous occasions. He was on the Parents and Friends Committee of St Joseph’s, which was the teaming disability section of St Ita’s. The allegations that the respondent made was that he was the parent representative to the committee, which he was not. The claimant read out the entire letter dated the July 17, 2003 as follows:
“As you have been advised by Lucy Walsh, Acting Head of the Psychology Department, I wish to meet with yourself and Lucy on Friday morning in my office to discuss with you a number of serious concerns in relation to your conduct and performance. These concerns relate to the following incidents: your election campaign in early 2002: your withdrawal from the St Michael’s House Challenging Behaviour Programme and your subsequent memo dated November 5, 2002; the implications of your expert witness role in relation to Cregg House, June 2002; the implications of your role as a parent nominee on the visiting Committee to St Ita’s.
Issues arising from your meeting with a client’s sister with Dr McDonald on March 19, Glenamoy, referring to your memo of April 7, 2003 to Mr John Birthistle.
Your memo May 5, 2003 to Mr Birthistle issues arising in relation to another client’s sister and Raheny respite on April 4, 2003. At the meeting on Friday I intend to outline the issues of concern in relation to each of these matters in detail. I invite you to bring along your representative to this meeting.”
The claimant’s understanding after he sent a letter to the Minister for Health was that a campaign was going to be waged to damage his reputation to put stress on him that ultimately he may or may not be able to endure. Of the eight matters listed in that letter there were no indication that there was likely to be complaints *7 arising in relation to these issues prior to July 17.
The claimant was appointed as a committee member of the visiting committee of St Ita’s probably around 2002. He acted as an advocate and as somebody who was seriously concerned and as a psychologist who had a certain prominence within the learning disability field he felt a certain obligation to advocate on behalf of people being ill-treated, the most vulnerable people in society who have nobody to advocate for them. He could not describe the stress of being presented with this as an offence or a serious concern, the fact that he would spend his free time working on a voluntary basis with a group of elderly parents who were trying to make conditions better for their children.
The claimant stood as an independent candidate in the general election in 2002 in Dublin North East at the request of a parents’ group in Limerick. They were setting up an alliance of eight candidates and they asked the claimant if he would consider standing in the election. His election manager was a parent of a child with a learning disability. The claimant asked permission to use the picture of the man who was on the election poster, and his parents were delighted to grant permission. The person on the poster was delighted and he subsequently had the poster in his bedroom. This was construed that the claimant violated the respondent’s policy on media, that he did not get permission from the chairman of the respondent to use this man’s picture on his election material. It was also described as unprofessional, a breach of his profession to do that. The night before the election the CEO Mr PL telephoned him at home to wish him well and he has numerous witnesses to that.
The Challenging Behaviour programme was a four-day training programme for staff that had to deal with people with learning disability. It taught them strategies to prevent difficult behaviour and how to subsequently manage them should they happen. It was a very preventative model.
The claimant contacted the training department at four o’clock on November 4 to establish if the material was ready for the course. At that time he was informed that there were going to be six members of St Ita’s staff in attendance at the course. He had not been consulted about this and this was the first time he heard about this. This was in 2002 and eight months prior to these serious concerns, it was discussed at the Psychology Department about the inappropriateness of including these individuals at a training programme, the disruptive effect that they had on the training programme and the necessity to plan for these individuals, if they were coming on board to the respondent.
The claimant in a letter addressed to the head of training Ms B dated November 5, 2003 outlined his dissatisfaction as follows:
“At a minimum this demonstrates a lack of courtesy on your part. The reality is that it is extremely shoddy practice and one in which I refuse to participate in. For the record no consultation has taken place with the Psychology Department *8 regarding the inclusion of participants from outside the organisation on challenging behaviour. No consultation has taken place with the Psychology Department regarding the appropriateness of combining staff of an institutional setting with St Michael’s House staff on the course. Had such consultation happened you would have learned about how disruptive such a mix can be and has been in the past. No information was made available to the trainers of today’s course regarding the altered make up of the group attending the course. With 76 of St Michael’s House staff on a waiting list to attend the Challenging Behaviour course it is incomprehensible and regrettable that external participants are given priority for attendance on this course.”
The next concern that the claimant had was the implications of his expert witness role in relation to Cregg House in June 2002. A family from the North West contacted him to establish if he would do an assessment on the plight of their son, a 19-year-old man with autism, because they were dissatisfied with the circumstances in which he was being held at Cregg House. Cregg House did not have any connection with the respondent that he was aware of. Cregg House was a service for people with learning disabilities in the Sligo region. As far as he was aware it did not have any connection with the respondent. This case was scheduled for the High Court or one of the courts. He did an assessment on the circumstances of where the man was living and a court case was then scheduled. The case was settled before it commenced.
The next issue arose as a result of the claimant meeting with a client’s sister and a professional colleague on March 19, 2003. This was a situation in which both Dr McD and the claimant were involved in treating a client. The claimant had never once received a set of minutes from Dr McD in the way they were presented to him. He had never seen these minutes and what was cited to him by Ms PD. Ms PD outlined that it was unacceptable and unprofessional for conflicting messages to be given to a family at a meeting with two professionals; this was disturbing for the family and potentially undermined their confidence in the service. The nub of the issue was that the claimant had requested two family members to hold off on a sale of a family home to allow a client from the respondent an appropriate period of time to get over the death of a relative. Dr McD did not express an opinion in relation to this matter to the claimant. The outcome was the family were sorry that the house had gone. The respondent told him that it would not be very satisfactory where the client was going to be accommodated but it was up to the respondent to work with him in the matter. The claimant stated that Ms PD used the term “righteous advocate” in a disparaging way and she described the claimant as a righteous advocate in how he operated in these situations. Ms PD indicated that a consistent pattern of the claimant adopting his righteous advocate role, which she believed, impacted on the claimant’s contractual obligation with the respondent. It was referred to further in her notes that it was in conflict with the claimant’s contractual obligation to *9 be a righteous advocate. The claimant was proud of the term righteous advocate if it was genuinely meant but he believed that in the context the term righteous advocate was used to undermine him.
The claimant’s understanding of concern number six related to the placement of a 21-year-old man with Down’s Syndrome who had a mild learning disability, he was verbal, he was ambulant and he was placed in a residential home where there were five individuals with profound challenging behaviours, all of them non verbal: some autistic behaviour, some with behavioural problems such as banging their heads off walls, walking around the house naked and self-induced fits. They had the catalogue of challenging behaviours. He felt that it was entirely inappropriate to place a verbal, mildly disabled young man, who had some challenging behaviours into such a setting. Glenamoy was a complex of houses on the respondent campus, where generally they are campus based, and most of the individuals there have some level of serious challenging behaviour combined with more moderate or severe learning disabilities. He had been involved in four of these houses (the Glens) because challenging behaviour was his specialty and he enjoyed his work there. He enjoyed working with individuals with challenging behaviour. The claimant was the actual psychologist to this house and he found out it that was this man was being moved to the house when he told him in the canteen. The claimant did not say that this was an aspect of the bullying that was going on in the respondent but it was totally inappropriate. A consultation did not take place in relation to this matter with Ms PD. The claimant was invited to one meeting, which was a general meeting. The claimant expressed his clear dissatisfaction before this man was placed in this house.
Item number seven in the letter related to a named client. The issue was that the claimant had attended a staff meeting where a number of staff were crying. It was one of the residential houses in the Glens complex. The meeting was about the care and lack of resources for a six foot five adult, a fully ambulant, physically strong autistic adult. The staff cried over the lack of resources, their inability to manage and the fact that they felt endangered in the situation. He highlighted the issues around May 5, 2003. He was extremely concerned that staff were getting hurt. One of the difficulties when staff were not being sufficiently supported in the situation was there was a high rate of staff turnover. The last thing that people who had a propensity for challenging behaviour need was change because they do not deal with change very well. In the course of six months the staff in this house had virtually changed 100%. The claimant dealt with inexperienced staff who were crying. As a clinician the claimant worked with what facilities are there and he advocated for resources to be provided, particularly in situations where he had an extremely difficult resident.
The concern that was listed as number eight in the letter was an issue, which arose in relation to a named client’s sister and Raheny Respite in April 4, 2003. Ms PD circulated a copy of a note from Mr DD a middle manager to Mr ND who was *10 a senior manager with the respondent on April 14, 2003. Ms PD advised that it was completely unacceptable for the claimant to actively encourage this divisiveness between family and the staff at a local level. It was an inappropriate forum in which to deal with these issues and it was an unprofessional intervention. Ms PD said that she believed that the issues questioned the claimant’s full understanding and acceptance of the limitations under which the respondent operated. The claimant read the letter dated April 4, 2003, which is as follows:
“On the afternoon of April 4, a service user from Kilmore Road local centre was admitted to Raheny Respite unit, he had sustained a fracture and was in a splint so there was some concern about the managing of his care. Kim Flood, Head of the Unit, Raheny Respite, advised me the client’s sister came to the Unit that afternoon and spoke to Kim. She said that she wished Brian to remain in Raheny until such time as a residential place was found for him. Kim advised that she could not make that decision. Una stated that she had been advised by Mark Harrold that ‘he who shouts the loudest will get a service’ and as Brian was on the waiting list so long he should get a place. Una seemed well versed in how to work the system. Kim referred back to the claimant in relation to the longer term plight of this man.”
The claimant stated that he never said, “he who shouts the loudest will get a service” . A meeting took place on September 24. Present at the meeting were Ms PD, Ms LW, Ms SB and Mr RY from Impact. At that meeting the claimant responded to the eight serious concerns as described in their minutes and he very clearly outlined how each of those issues were completely spurious. He rejected every single one of them and he presented the arguments that he had presented to the Tribunal in the morning. He felt it was a calculated attempt to undermine his integrity, to place an unreasonable amount of stress on him and ultimately he supposed to leave the respondent. Ms PD felt that the claimant was over-elaborating in his dissatisfaction and he was seriously dissatisfied with the tactics that were being adopted to undermine him. Ms PD left the room at one point and she carne back and the claimant softened his statement. The claimant’s concerns about this process did not alter at all and he was most dissatisfied by it. He felt that each of these issues was manufactured and designed to undermine him. His concern was about the culture of bullying in the respondent dated back to the CEO and his manner of doing business, it was similar to the previous case that he talked about, the trumped up allegations and then waiting it out until the persona finally broke.
Portion of a letter written by the claimant on November 6 stated as follows:
“I would suggest that in order to limit any further damage to the organisation the following actions be taken by you. An unconditional withdrawal in writing of the eight allegations levelled at me, as outlined by you at the meeting of July *11 22. A written assurance that there will be no repeat of this type of harassment of me at any time in the future. A commitment by you to investigate Mr Birthistle’s actions in relation to the Glenamoy incident with a view to ensuring that there is no repeat of this type of dismissive treatment of me or any other psychologist in the organisation. An assurance in writing that I will be accorded the courtesy of being informed on a timely basis by the Training Department of any changes in circumstances regarding the course I am giving, such as the inclusion of people from outside of St Michael’s House. You will note that I am not seeking an apology for any of this debacle, as that would be of limited value, however I will be reserving judgment on your bullying practice for a considerable time to come. The wider issues of concern in this organisation are being addressed in a different forum, I have kept the subject matter of this letter to the issues you raised in such a regrettable manner on July 22, 2003. Should you choose to ignore this letter or to proceed with your allegations on what you describe as a disciplinary footing I will welcome the opportunity to highlight your actions and those of your cohorts in a much more public forum.”
The claimant did not receive a reply to that letter. The claimant did not receive any communication from anyone in management as to the status or outcome of these concerns. The claimant stated that there was some other issue about a locked door in one of the residential units that emerged in the course of another investigation, and this was one of the houses to which he was attached, and a process was commenced along these lines which was investigating why the door was locked for this client. It appeared by the time he had left that they were trying to narrow this down to being his responsibility. He viewed it as a further attempt to put undue pressure on him, which it did. This was around January/February/March 2004 and the person responsible for conducting that enquiry was Ms PD.
The reason that he submitted his resignation was that there was nothing happening on his concerns. The claimant was supposed to continue working as a clinician in circumstances where he felt no matter what he did somebody somewhere would try and construct a case against him. The claimant at this stage had exhausted all of his sources or avenues of communication because it was clear the CEO did not have the capacity to take a broader view and a responsible view of the issues that he had raised initially. He did not see that there was anywhere else he could go with this issue. The claimant resigned in March 2004 and left in April. The claimant is currently employed. He works for the Health Service Executive in the North East region and is based in Dundalk and Drogheda. He is working as a half time senior clinical psychologist. He commenced employment on April 26, 2004. He earns a salary of between €35,000 and €40,000.
The claimant gave further direct evidence to the Tribunal on January 16, 2006. The claimant said he was satisfied in relation to the family of Mr PMcK and that he had investigated thoroughly the circumstances of his death. It was the *12 catalyst for him saying that he was not going to see further families being hurt in this way so that is why it was a very significant case and relevant to his case. He regretted that Mr MH did not do a similarly thorough investigation of the culture of bullying that was such a feature of the respondent and continues to be. When he wrote to the Department of Health in June 2003 it was a month later when they levelled these eight other allegations, which were not specific to Mr FS. Because he had been trying to get some independent investigation or something done about both a valued colleague and also a family who were availing of the services of the respondent. The lead up to his constructive dismissal was from 2001 when he had written to the board. The campaign against him started in July 22 when Ms PD invited him to a meeting. In 2003 the respondent claimed that it had 129 clinicians and the number of clinicians that left was three. He could name five people on the investigations that he had completed and they were very limited investigations He stated that a figure of 129 clinicians was preposterous. There were at most 45 clinicians within the organisation. There was a significant change in the attitude of Mr MH from his report as presented in October 2003 to that which was presented in 2005. Mr MH met with the family and that was the material difference. Mr MH obtained further information as to what had happened. Up to that Mr MH had only been acting on the information he had received from the respondent, which was why he would have viewed it as a pointless exercise to contribute to his investigation in the absence of meeting with the family of Mr PMcK.
In cross-examination when asked by counsel for the respondent when did he make the decision to resign he responded that his personal circumstances had changed. His wife had just had their first child and he was not prepared to put his wife through the stress involved. He decided early in 2004 that he had enough. He tendered his resignation in March 2004 and he probably made the decision in March. The claimant had attended for interview in March 2003 and he was offered the job in January 2004. He accepted his current job shortly before he resigned from the respondent. The reason that he decided to change from fulltime to half-time was that he wanted to spend time with his son. He did some writing and had just launched a book. He was in the process of completing a book on parent training.
The claimant wrote to the Minister for Health in June. The matter was referred to the Eastern Regional Health Authority who then appointed Mr MH to conduct an enquiry into his complaints.
A letter addressed to regional chief executive (Mr H) of the Eastern Regional Health Authority stated as follows:
“Dear Mr Hynes,
I refer to your request of August 25 to carry out an independent assessment of *13 the above matter. I have carried out a detailed assessment of the issues involved in accordance with the terms of reference outlined by you. I attach my report and the outcome of my enquiries. I can confirm that I have received full co-operation from St Michael’s House and-relevant staff in the ERHA. I regret the delay in submitting the final report, some of the people that I needed to speak to were on leave at various times and this led to the delay in completing the report. I have examined the original complaints and spoken to the person who made them. The person who made the complaints did not give me any details to support his case despite being given ample time and opportunity to do so. I have examined in some detail his complaints in respect of the client and the staff member and I am satisfied that while both are sad cases the complaints made in respect of St Michael’s House are unfounded. If the person who made the complaint had some unique insight not apparent to others in St Michael’s House or to myself he ought to have shared that with the management or the Board of St Michael’s House. I am satisfied that the process of enquiries undertaken by St Michael’s House were undertaken in a fair and appropriate manner. Please feel free to contact me if you require clarification.”
Then he wrote that he would forward a note on his fee under a separate covering.
The claimant accepted that Mr MH referred to his report as a final report. The claimant stated that all of the relevant parties were not interviewed. It was not accurate to state that part of the reason that he resigned was the manner in which the respondent dealt with the transfer of the late Mr McK who had died. It was the manner in which they went after the claimant when he tried to do something about the circumstances that he was removed to that place. When asked if he accepted that in dealings with organisations like the respondent have with the vulnerable in society that they have to take advice from psychologists, psychiatrists, medical doctors he responded the he was one himself. The claimant accepted that occasionally clinicians and other experts would disagree. Mr MH did not interview the immediate clinicians who dealt with Mr PMcK. When asked if he had the consent of the staff member to incorporate his name in the original letter of complaint before he delivered the letter he responded that he did not recall seeking formal consent. At this time the claimant stated that he was not claiming that he was bullied at that time at all. The claimant did not believe that his concern about the culture of bullying in the respondent was a typical grievance because it was not even about him. The claimant had no difficulty with a member of the board personally who was a businessman and tendered competitively for business with the respondent. But if this man was investigating serious concerns that the claimant as a senior clinical professional had highlighted his relationship with the CEO and his business interests rendered him not an objective member of an investigating committee.
When asked that three out of the four years the turnover in clinical staff was *14 about half the turnover in general staff he responded that he did not know how these statistics were derived and the claimant certainly debated them with Mr MH. The claimant did not have any statistics to indicate otherwise. When asked that the key element of the reorganisation was relocation of the regional offices of a number of clinical staff and that psychologists alone among the clinical departments did not accept the reporting lines the clinic manager proposed in the restructuring plan of the clinic he responded the social work department objected also. When asked that on March 13 the arbitrator stated that he was satisfied that the reporting relationship to the clinic manager was appropriate and should be accepted by psychologists in the respondent the claimant stated that he recalled that decision and he recalled being very unhappy about it. When asked that he continued to complain about it years later he responded that you had to accept it. The claimant disagreed that there was a diminution of the clinical role and there was an undermining of the reputation of those who established the reputation. The claimant had expressed concern that the organisation needed outside people. All of the appointments were internal, and he did not think that was healthy for an organisation. He disagreed that his complaint was dealt with in a fair and appropriate manner. The claimant acted out of professional concern. He did not gain anything out of writing to the board. The only thing he knew that he would probably gain was where he has ended up. The claimant accepted that there was no reference to the report dated October 23, 2003 being in draft.
When asked to summarise briefly how his employer bullied and harassed him in relation to Mr P McK the claimant responded that he was not claiming any bullying or harassment in relation to Mr PMcK. He would never have made the claims until these eight allegations were introduced a month after he wrote to the Minister for Health. His bullying and harassment claims centred on the eight allegations.
In cross-examination on January 16, 2006 the claimant stated that he was still employed in a part-time job with the health board. It was his own decision to continue to work part-time. His wife has had a baby. He assessed his situation and his commitment ultimately to his wife and family and that is why he continued to work part-time. The claimant agreed that he had never sat down with anybody, be it in the internal three-person committee, the subcommittee of the board or Mr MH and set out in detail his submissions justifying his allegations of bullying.
All social workers were classified as clinicians. He accepted that not all of them left the respondent because of the culture of bullying. When asked what he meant by the word “haemorrhage” he responded he was concerned about the turnover of staff. He was aware that there was continual disillusionment and the psychological department had an investigation with the union where they complained about the undermining of the clinical role. He could not remember exactly the time of that. The psychological department lost that investigation but his observation remained valid. As part of a regionalisation structure *15 administrative managers were going to have more input in how psychologists or clinicians actually worked. It was called a matrix system and an arbitrator was appointed. The arbitration took place in March 2003 and was concerned with the reporting relationships of psychologists within the new regionalised structure of the respondent. It was fully part of the collective negotiations between the trade union who represented the claimant and his colleagues. There was disquiet among the Psychology Department because they would not have gone that far if there had not been. There was significant disquiet about the undermining of the clinical role at the time. The claimant agreed that the arbitrator held that there was no undermining.
Mr PL (CEO) wrote the claimant on October 1 advising him that he proposed to appoint three senior managers, Mr K, Mr M and Mr R. The claimant objected to the appointment of Mr K and Mr R. The claimant did not have a personal grievance at that time. He had a serious concern about the treatment of a longstanding staff member and also the treatment of a family who had been sent to LC nursing home. He did not think it was a standard grievance procedure. The one board member that Mr PL appointed to represent the respondent to investigate his complaints had a major business contract with the respondent. He supplied all of the respondent’s medical supplies and all of their domestic supplies. The claimant received a letter from the person that he objected to in which he outlined to the claimant that he had an involvement in the respondent for the past 26 years. He was currently acting as chairman of the Policy and Planning Committee and recently completed the five-year plan for the respondent for 2002–07. He also outlined to the claimant that he had never received benefit of any kind. His only business interest was that a company which provided a service to the respondent employed him. It was the claimant’s understanding that it was his own company.
The claimant did not have any personal complaint in October 2002. The claimant stated that the first time bullying started was the day that Ms PD called him to a meeting to outline the eight allegations against him. When asked if any of these resulted in any imposition of any sanction on him he responded that he was only learning about them for the very first time at the meeting. The claimant stated that there was no procedure. The claimant attended a meeting in July and in attendance were his union representative, Ms PD (the deputy CEO), Ms B from HR and Ms LW who was the acting head of psychology at the time. The claimant agreed that his union representative accepted that the claimant was at the meeting to listen. Conclusions were made about the claimant’s lack of professionalism and poor conduct. Before any discussion had taken place Ms PD had made up her mind about how the claimant was supposed to be conducting himself.
It was agreed that the next meeting would take place on September 25 and the purpose of that meeting was for the claimant to respond to the eight issues. The claimant set out his responses to each of the eight issues. The claimant *16 stated he could not comment on the use of a client’s photograph on a political poster. The poster that the claimant used was to highlight the issue. The poster was a picture of a man with Down’s Syndrome, an elderly person and a hospital bed. Due to the fact that it was different and the claimant was standing as an independent candidate to try and raise the profile of rights for disabled people. He was not aware of a letter dated October 23 which Ms B wrote on behalf of the respondent to the claimant’s union representative. It was the first time that he had seen it. The claimant wrote to Ms PD in November about the eight issues as he had not heard anything The claimant had not seen the letter dated December 5 from Ms PD to the claimant’s union representative. He may have looked at it at some point but he certainly did not get to see it before he left. He did not speak to the union representative or have any contact. The only contact he had with him was subsequent to September 25 was approximately December 17 when he called him to tell him that the psychology department wanted to write a letter of support because of his circumstances and he felt that it was not a good idea. He took another call in the middle of that and he did not hear from him subsequently. He did not accept that these were important letters because he understood that at that time his union representative had a close bereavement and he assumed that he was not responding. The claimant was awaiting a response from Ms PD that he never received.
When asked that in 2001 108 full-time clinicians or the equivalent were employed he responded that counsel for the respondent seemed to be harping on an observation that he had made and were getting into a technicality regarding the definition of a clinician. When asked what he defined as a clinician he responded people who operated from the clinic, which included a psychiatrist, physiologist, social worker, physiotherapist and speech, language and occupational therapist.
In answer to questions from the Tribunal when asked when did he go to his union for help, he responded when the eight allegations were listed. When asked why he dispensed with his union and chose the solicitors he responded that he did not dispense with his union, he engaged the solicitor formally when the board of the respondent contacted him through its solicitor. He had not engaged a solicitor at that point. That was probably during 2002. He did not have his union representative there until June or July 2003.
On re-examination by his counsel he stated that he had a vague familiarity with counselling at pre-disciplinary stage, a verbal warning and stage two written warning. When asked if he was ever approached by anyone in the respondent in relation to this counselling he responded that no unless he wanted to interpret Mr PL’s meeting earlier on. He did not receive a verbal warning. He was employed for 13 years with the respondent and was 100 per cent fully committed to the organisation. There was nothing brought to his attention in those years. His immediate supervisor was Mr MM. He had regular supervision with Mr *17 MM and they discussed his work but he never approached the claimant about complaints regarding his conduct. In regard to the election poster he said he was not exploiting anyone he was trying to forward a cause. He did not accept that he acted in breach of guidelines. No one complained to him about his visits to Cregg House. The claimant caused none of the delays and he did not know what was happening and that is what prompted the claimant to write to Ms PD.
An issue arose in relation to evidence that a witness Mr M on behalf of the claimant was going to give. The Tribunal adjourned to discussed the matter. On reconvening the chairman of the Tribunal Division stated that the Tribunal had to decide the issue of the admissibility of the evidence of Mr M and the Tribunal has considered the submissions made by counsel for the claimant and the respondent. The Employment Appeals Tribunal dealt with labour disputes and the Tribunal has to focus on this labour dispute. The claimant feels very strongly about these issues and he was given, the Tribunal considers, a full opportunity to ventilate his feelings and to give his evidence. However the Tribunal have to apply in this Tribunal the test of relevance and have decided that the evidence of Mr M was not relevant to the hearing of a labour dispute for two reasons: the first reasons was what Mr M’s evidence would corroborate was alleged bullying of family but the case was about the claimant’s relationship with his employer and the alleged bullying of him. The Tribunal considered that Mr M’s evidence was not relevant and the claimant would have an opportunity to prove his allegations.
The first witness on behalf of the claimant Ms DK told the Tribunal that her role in the respondent would have been assistant house parent employed for 22 years from 1980 to 2002. She worked in Gleneally, which was one of the houses in Ballymun, the claimant was the senior psychologist and she would have worked extensively with clients through the claimant. She would have held the claimant’s opinion in very high esteem. They worked as part of a team and the nature of the clients they worked with in particular would be of varying levels of ability and challenging behaviour. Her experience of bullying in the respondent went back to May 2000. She would have attended staff meetings on a regular basis and would have brought up what she thought was a very reasonable question about taking annual leave on a bank holiday. At the meeting there would have been her head of unit and two other members of staff. She was openly accused of undermining her head of unit’s role as manager. She actually could not understand why she was made to feel so intimidated. When asked who made this accusation against her she responded Ms AG. Her shifts were constantly changing. She had a difficulty in that if she wanted to take a day off on Monday who did she ask. She wanted the simple clarity as to who provided the cover on Monday. It ensued with four meetings with management and the resident manager Mr PC asked her to retract her comments about Ms AG displaying elements of bullying. She could not understand why a local issue had to be brought over to headquarters to be addressed. She was asked to retract her comments and she felt that the head *18 of unit Ms AG had displayed elements of bullying. She became aware that Mr PC had attended a meeting with Ms O’D a psychologist and they discussed this issue. The second incident of bullying was she felt referred to Mr PMcK. Both Mr PMcK and another client lived in the house that she worked in for seven years. Mr McK had moved and then subsequently moved to a nursing home. Mr McK died in October and soon after the senior psychologist Ms B approached them and offered debriefing sessions to the staff and clients. They were pleased to have this input from Ms B. At the second debriefing session she felt that she picked up a certain amount of disharmony and disquiet. The debriefing came about due to the sad loss of two clients within a week of each other. It was a house of five clients and a team of six staff and a head of unit. Ms K felt that a lot of questions were unanswered and these were all in connection with the death of Mr McK. She felt that, as there was a sense of anger that it would be advisable for staff to put their questions on paper and that management would address these issues. They would meet in an open format as a group setting. She had no problem doing this and within a short period of time the claimant and her colleague Mr MC who is still employed by the respondent compiled up to 23 questions and presented them to management. She and her colleague were informed that there would not be a third debriefing session as initially promised and that they would meet individually with management. Two members of management Mr JB residential manager and Mr PC who was over their particular house would meet with them. They sought advice on this from their union who informed them that not to meet individually under any circumstances. They then met with Mr JB and they were advised not to take notes.
The questions that she wrote down were as follows:
“What were the criteria for selecting nursing homes for people with learning disability and Alzheimer’s?
Why was Leas Cross selected? Was Leas Cross Nursing Home registered with the Eastern Health Board? Had St Michael’s house management ever visited the premises prior, to and after Mr P McK was admitted. Did a client from the respondent ever die in Leas Cross nursing home or was admitted from the nursing home to hospital in a critical condition before. If so was the respondent satisfied that Leas Cross management had acted professionally and in a caring manner on both occasions. If a client had been admitted to hospital from Leas Cross before was the respondent management aware as to whether the client travelled alone, by ambulance or was accompanied in the ambulance by nursing home staff.”
She did not receive answers to those questions directly. No one question was picked out, they were more or less set down and Mr B spoke in a roundabout way. They were led to believe that Leas Cross was a reputable place and they were happy with what they had heard about the conditions. The second incident occurred in February 2001. The third incident was in May 2001 again by chance *19 she mentioned Mr PMcD because he had appeared in all these three incidents. He was part of it, which was quite extraordinary. Mr PMcD was in the staff room and came across a manual. There was nothing private or confidential written on this folder. He just went through it and he found a chart that was a competency chart that apparently the respondent was using as part of a training programme. On that chart there were various skills, which listed workability, teamwork, managerial, work on competency with clients. Different sections were labelled and underneath there was a scoring square and if the square was completely darkened you were considered fully competent. When PMcD found this chart the other four members of staff had mostly blackened squares, which meant they were highly competent. Both PMcD and Ms DK had 13 and 12 respectively. The chart did not have a date on it but the folder was dated May 2001. It was not signed but the writing was very evident. It was the head of their unit Ms AG. When they discovered this chart they approached their unions. Ms K mentioned to Mr PC that she was very unhappy with this and asked what was the format or why was this set up. They raised the matter with Human Resources and through their unions. She raised the matter with Ms SB in HR and she did not know whether she is still in HR or not. They received a letter from Ms AG apologising. She apologised more that they found the chart. She received a letter it was not signed by Ms AG and it was PP Ms SB. The letter dated August 22, 2002 stated as follows:
“With reference to the complaint made regarding my assistant house parent competency chart, I understand that while reading my coaching and mentoring skills file you became aware of the assessment of competency of staff members in Warren House Road, as recorded by me as part of a training exercise.
It has been brought to my attention that you have taken offence at my assessment of your individual competency relating to aspects of your job. Firstly, I must apologise for any insult, which may have resulted from my assessment. I assure you that it was never my intention for to offend you in any way. I had not intended for this document to be seen by staff and apologise to you both that you became aware of it in this manner.
You correctly pointed out that I had not discussed these areas with yourselves. Regrettably, as we have no formal appraisal system agreed with the unions, it was not possible for me to do so. Instead my intention had been to informally coach each individual on the job. Please be assured that no malice was intended, and I apologise for any hurt that this may have caused.
Yours sincerely
PP Sarah Bars”.
Mr JB met with the staff and as two of the respondent’s clients had died. The beds were used as respite but the house was closed and the staff would now go *20 elsewhere. They had a choice as to where they could work. They documented their requests on paper and when she indicated her choices to Mr B he told her that she had no choice whatsoever. At this stage she just felt her position in the respondent was untenable and that really there was little left for her. She had very little option but to leave. She felt that her choices were not being addressed. She went and viewed the house in Raheny and she did not feel that she was being listened to. She was excluded from staff meetings.
She was excluded from one particular client meeting; she was a key worker to a client for the last seven years and worked extensively with her. She felt that she had built up a good rapport and suddenly this meeting took place. She was employed in this house and she was left sitting there. The house closed in March 2002 and it was near the autumn of 2001 that the incident happened about not being asked to attend the meeting.
In cross-examination Ms DK accepted that she did not agree with Ms AG’s managerial practices. Debriefing sessions were counselling sessions provided to support the staff. She did not attend the meeting that the employer had suggested. She believed that a document was used for the purposes of internal training of staff. She did not accept that it was not set up for any other purpose. She believed it was left out purposely for staff to find, she believed it was left out to undermine her credibility and she believed that it was a defamation of character. Ms DK stated that she was offered a position in Raheny. She declined that position. She obtained alternative employment in Bray.
The second witness on behalf of the claimant Ms UO’ R told the Tribunal that her brother who was 47 was a client of the respondent for 40 years. He had lived at home with his parents all of that time and in that time probably had about five respites. His name was on the waiting list for residential care. Her brother would be considered severely handicapped by the respondent’s standards. Her brother developed pneumonia and for the eight weeks he was at home with her mother the respondent did not contact them with an offer of help. Things went downhill after her mother was admitted to hospital at the beginning of 2003. Ms UO’ R had a four-month-old baby at the time and was unable to mind her brother and he was taken in as an emergency case. Because he had lived at home with his parents for so long he was used to a routine. Within the eight weeks he was moved between 22 and 24 times. Every week he was moved two to three times. She was basically handling her brother’s care at the time because her mother was in hospital and unable to help at all. She wrote five letters to the respondent and did not receive a reply to any of them.
She met the claimant, as he was the psychologist for her brother in the day centre. Within three weeks of her brother being taken into full-time care he had started to soil himself and he developed an ulcer. During that time he also broke his kneecap. He was still being constantly moved so the claimant would have been talking to him and trying to give advice. She met the claimant on a few *21 occasions in the respondent’s day centre and explained to him the situation and he was aware of her brother’s situation. Ms UO’R denied that the claimant said that he who shouts the loudest gets a service.
When her brother was discharged from hospital Ms UO’ R spoke to the house manager, Ms KF, in Raheny at the time. She explained the situation to Ms KF and she brought her brother out to Raheny. She told KF that she had been waiting 10 years for her brother to get a place and Ms KF told her that she would have to wait. At this time she had met the claimant on three occasions. She spoke to the claimant about her brother and her mother. The claimant visited her mother and he was the only person from the respondent who took the time to appraise the situation. The only dealings that she had with the claimant were in relation to her brother’s situation.
In cross-examination when asked where her brother was now she responded that he was in a rented house in Swords, which was part of the respondent company. The care that he received on a day-to-day basis was very good.
The third witness on behalf of the claimant Dr PH told the Tribunal that he qualified as a doctor in 1983. He did five years training as a GP and he has been working in that area since then. About 10 years ago he became interested in the connection between health and work and he gained further qualifications in family therapy or systems therapy, which was trying to use language to look at solutions to try and understand problems within the context of families. He gained further qualifications in executive and business coaching on how to help individuals and businesses to look at a positive outcome. It was a two-year postgraduate family therapy degree in Australia.
The claimant went to him at the end of 2004 and he met the claimant on two occasions. He did not go through a formal medical examination with the claimant but it was obvious that the claimant was upset. This was having an effect on the claimant’s psychological, personal and his family life. The claimant felt that there was still work to be done on behalf of his patients in terms of getting a sense of fair play or getting a voice for what happened.
He contacted the respondent and he spoke to Mr PL the CEO. Dr PH told him he had some concerns about bullying in the organisation. He outlined some of his experience to the CEO and that he might be of some help. He was interested in working with the respondent in order to facilitate some sort of solution. He felt if it came from the top that there was a sense that they might be able to work together. The effect of the response was that he did not contact the respondent again. He really felt that after the telephone call that he was not dealing with someone who was going to engage with him in the claimant’s case.
In cross-examination when asked when he spoke to the CEO that he was offering his services to the respondent he responded that he was. He spoke to the CEO three months after he met with the claimant in early 2005.
In answer to questions from the Tribunal when asked if he carried out a *22 diagnosis of the claimant he responded that he had two roles, one as a doctor and one as a life coach working on bullying. He did not have a sense that the claimant needed his medical help.
The fourth witness on behalf of the claimant Mr CR told the Tribunal that he had a certificate and diploma in social work. He was a qualified psychiatric nurse, a qualified nurse for the mentally handicapped and he had a diploma in public administration from UCD and a certificate in health economics from UCD as well. He commenced employment with the respondent in June 1997. He was employed on a three-year contract. His contract terminated on June 2, 2000. He was working half-time. He was working on the south side of Dublin, which was a much smaller team than the one in the North side. He was part of an Early Services team, which was linked, with new referrals of children who had learning disabilities. He met with parents in the early stages and as part of the team developed supports for them. He was also providing support to a number of units of children who had quite severe levels of handicap who were in day services and he was supporting both the unit and the parents whose children were attending the unit. He never felt that he was bulled on a personal level. On May 16 when he was informed that his contract was terminated he felt that something was awry. He was quite shocked when his contract was terminated because it had never occurred to him at any point that his contract had been terminated. The week before that a colleague who was doing some intensive difficult work with him made a comment to him that he was working so many hours and that he should apply to the respondent for an increase in his wages and he laughed at her and he told her that organisations did not work like that. He was informed that his contract was terminated with no warning and no discussion. He had never raised the issue of his contact being renewed either because it had never occurred to him that anything but a continuation of it would be happening.
The fifth witness on behalf of the claimant Mr FF told the Tribunal that he had contact with the claimant in or about 1992 and the claimant was the most committed professional he has every worked with in this field. Mr FF stated that there were many fine people who worked in this field of intellectual disability. It was a difficult field to work in with a lot of very challenging behaviours, challenging work and nobody had given more of himself than the claimant had The claimant had a 24-hour day, seven days a week commitment to people with intellectual disability at the very highest level. He did not know of anyone in the country who was more committed than the claimant was. The claimant had never been involved in the care of his daughter so he had no direct experience on that on a one-to-one basis. The claimant was someone who had advised organisations, helped them to learn, to confront behaviours and to determine what the priorities were in terms of the services that were needed and the claimant has been completely invaluable. Mr FF had never known anybody to second guess his judgment on any of these matters and he had never known him to withhold *23 a judgment or to withhold time and effort. The claimant in his view had striven to ensure that the highest standards were met by the various organisations that Mr FF was involved in.
Mr FF talked with Ms DK and Mr PMcD. In the course of that lengthy meeting they both confirmed to him their belief and experience of a very difficult and oppressive culture within the respondent. He could not put his hand on his heart and say that they used the phrase “culture of bullying” but everything they described would be certainly tantamount to a culture of bullying in his view. His interest in talking to them was twofold. One was related to the facts of Mr P McK and the way in which the respondent had reacted to them in respect of the concerns that they had raised about Mr PMcK.
The sixth witness on behalf of the claimant Ms AO’N told the Tribunal that she had a primary degree in social science and a Masters in social work. She received her primary degree from 1983 to 1986 in UCD. She completed her Masters from 1993 to 1995. The bulk of her work during those years between the time she finished her degree to the time she did her Masters was primarily in the area of care work.It was two settings, one was a long-term hospital unit for elderly people in St James’s hospital and the other was the national MS care centre in Rathgar. She felt she had experience of two settings with very different standards of care provided in each. She was very lucky to be involved in the setting up and opening of the MS care centre, which was recognised as a centre of excellence and was set up as direct response to the lack of appropriate respite places for people with physical or neological disabilities. Following her Masters she worked for two years in child protection in the Health Board and she had the opportunity then to travel for a number of months and she lived in Mayo and she took up a locum position in Cerebral Palsy Ireland, which is now Enable Ireland in the Child Development and Assessment Centre in Galway. She started work with the respondent in May 1988 initially on a six-month contract. The initial vacancy arose because one of the social workers had been released to undertake another piece of work within the organisation. That took longer than the six months that was allowed, so she was there on a temporary basis for approximately 18 months. She was interviewed for a permanent post in December 1990 and she was successful at the interview. The head of her department told her that she believed that she had issues with management and that those issues would need to be resolved during her probation period. When she commenced work with the respondent she became aware that there was a huge level of discontent within the department and she described it as a sort of climate of fear. She was referring to staff with 15 or 20 years’ experience feeling such a level of intimidation that they could not express their opinions even at a social work meeting. She was taken aback by that. She felt that she was in a luckier position in that she did not have historical experience in the organisation and she felt she was able to voice her opinions more freely than other people. *24 There was definitely a type of atmosphere that people were afraid to speak.
She voiced her concerns about the delivery of services in terms of specific issues but she would have tried to have discussions about how people felt they were being managed as a department. People made an effort, which ultimately led to a facilitation process. Staff would have initially started to try and raise those issues themselves. Her issues with management had to be addressed during her probation. She stated that between February to April 2000 supervision session took place. The supervision session would take place between a basic grade social worker and their senior social worker. There were different elements to it; one was to show that you were completing your work satisfactorily; to be able to discuss issues of difficulty and cases that you were struggling with. There was also a large element that was supposed to be a support system including professional development. That was the context and without any sort of advanced warning in her supervision session it was raised by her manager that over the following months of her probation that she needed to basically work on her attitude. If she was not engaged in that process of working on her attitude that she would not be able to pass her probation. They discussed her attitude to management She asked if there was any difficulty with her work and with her practice. There was no issue around her work and her practice but she needed to look at her attitude. It got to a point where she felt that she was up against a brick wall. They kept harping on about her attitude and it resulted in her breaking down and bursting into tears, which was not something that she was prone to doing. She was devastated after it and she felt that the whole thing was being personalised. She was aware of the fact that her head of the department and her manager had discussed this with the HR manager Mr NR so she requested a meeting with him. She was then summoned to a meeting with her head of department and her manager. She did not know what to make of this. She was given no information about the content of the meeting.
There was a bit of a time lapse and they came back and she was told there was no difficulty. It was a very brief meeting and she did not need to bring anyone with her. She went along to the meeting having been advised by the union that if anything was raised that she could withdraw from the meeting. She went to the meeting and she was informed that she was permanent and everything was dropped.
She felt it was inappropriate to use a nursing home in terms of staffing levels, training of staff, policies, guidelines and she was not sure that they were all appropriately in place. The training in the respondent was of a very high standard to ensure that. She felt that there was no adequate way of monitoring the standard of care in places external to the organisation. She just felt that the level of care could not be guaranteed. In May 2000 the difficulties within the department were addressed through a facilitation day, which in itself she thought was a very traumatic experience for a lot of people. She personally felt very *25 demoralised. She had never experienced in her previous places of employment the number of people that left the respondent in unhappy circumstances. She found that the number of situations that involved an element of somebody being very dissatisfied alarming. Staff were dissatisfied with they way they were managed. She left the organisation in July 2005. The main reason she left was she felt she did not want to work within the environment of a similar sort of management experience as she had previously experienced. She was a senior practitioner with the respondent and she went to a basic grade post. Part of her reason for taking up the new post was that she had some inside knowledge that there was a certain style of management. Her new post also had a lesser salary.
In cross-examination when asked that the respondent informed her that she was good at her job she responded that she would not say that the respondent let her know she was good at her job. When asked that she was promoted she responded that she was. She obtained the senior practitioner post in 2002. When she took up her new job she was near to her home. She felt that there were issues around the management to her department who were Ms ME, Ms VB and Ms JK. She found it difficult to work with the regional director and the clinic manager. Prior to her leaving the respondent she stated that she applied for a senior post with the respondent but it was not within social work, it was in relation to integration of children attending mainstream schools. It was an area that she had a particular interest in. She thought that another candidate was successful. When asked if she were successful at the interview that she would still be employed with the respondent she said that she would. It was an area that she was very committed to in terms of integration and inclusion for people with learning disabilities in mainstream services.
When asked why her union had never made a complaint on her behalf regarding alleged bullying she responded that it was dropped. She had never written a complaint indicating that she was bullied but if it had continued she would have had to do it When asked if she used the word bullying she responded that she did not know if she did. She could have used the term bullying behaviour.
The seventh witness on behalf of the claimant Ms EL told the Tribunal that she has an arts degree in English and Sociology, which she received in Maynooth in 1991. She then did a diploma in social policy in UCD. Following on from that she worked in 1991/92 with homeless families. She went to Chicago to work in a residential facility for people with learning disabilities for a year. She returned to Ireland in 1994 and she completed a Masters in Social Work in UCD. She worked for three years on the soup run with the Simon Community from 1990 to 1993. She worked from 1992 to 1993 with Focus Point. From 1996 to 1997 she was involved in child protection cases with the community care area in the Eastern Health Board. She applied for a job in the respondent and took up employment in May 1997 and she worked there until May 2004. She moved to the Doorstsep *26 Charity on the Navan Road where she was a principal social worker. She was recently appointed senior social work practitioner in the respondent shortly before she chose to leave. When the principal post came up in another organisation she applied for it and is now a principal social worker. When she started working with the respondent she was employed as a basic grade social worker and she had more or less the same caseload for the seven years that she was there. She worked with children with a moderate to severe level of learning disability from the age of three up to the age of 18. She also worked in a special national school for children with moderate learning disability and in the last couple of years she worked in the Cara Unit, which was the respondent’s facility for people with learning disability and dementia. When she joined in 1997 she would have been aware of an atmosphere historically within the social work department and that people said be careful what you say, be careful in social work meetings.
She observed for a short period before participating fully in social work meetings that strong opinions that were contrary to the decisions made by management would not have been received very well. Staff were not asked for comments and it was an unfortunate period in the social work department, particularly the years 1998, 1999 and 2000 where comments would have been made about consultation being only a matter of courtesy. She felt that there was a certain management style within the organisation, which was to deliver decisions without having any discussion. It was unfortunate that statements would have been made by Monica like, “I don’t want to be threatening about this, but she said she would come on the heavy if you cannot reach a resolution” . The witness found these statements very out of line with the organisation, which she had signed up to work with.
She raised issues in the early stages of bullying in her supervisory meetings. The meetings took place about once a month. She recalled that in 2000 she telephoned HR to enquire if there was any anti-bullying training available. The person that she sought advice from told her that a proposal had been put to Mr NR, HR manager, from some of the members in human resource and he had adamantly responded no. When asked if the respondent did not direct her to the booklet on anti-bullying policies and procedures she responded that she had obtained her own information from the union. She was not aware that an antibullying training or a workshop was in place in the respondent. She felt that it would be in everyone’s interest to have very clear and transparent policies and procedures, an employee manual and a manager’s manual. She stated within the department, staff felt bullied and they tried to address it. When they felt they were not getting anywhere they went to Mr DK. She could not remember what Mr DK’s role was at the time and she thought it was clinic manager. She would have felt that it was the correct avenue to pursue. She had gone to Mr DK firstly about Ms AO’N, a colleague of hers who had gone for permanency and was informed that the probation period would be a time when issues around her *27 style of management would need to be looked at. She would have gone to Mr NR who had recently joined the company and told him that she was unhappy with what had been said to AO’N about her permanency. Mr NK made a remark what is going on in this organisation. She would have been party to a lot of the department meetings with Mr NK. She was shocked when Mr CR’s contract was not continued.
The first document she saw concerning restructuring and reorganisation would have been in 1999. She knew the organisation would have concerns about the regionalisation process and some meetings would have taken place were staff were initially asked for input around 1997/98 when the organisation was starting to restructure. Staff would have had huge concerns about the process. They would have liked the union to be involved as a social partner in that process.
Across the department there was collective concern about the use of nursing homes to varying degrees. There were a large number of users who felt it was wrong and that facilities were inappropriate. She could not say how supervision procedures could be put in place.
She had mixed reasons for leaving the organisation. She had worked in the respondent for seven years and she was very committed to her work. She had the opportunity for career advancement and she applied for a post. She had returned from a period of maternity leave in 2003. After having had a baby she did not want to return to the atmosphere in the respondent, which she had found very difficult up to the period she had left for a number of reasons. She was part of discussions from 1999 to 2003 that were quite difficult negotiations, including the facilitation process and the regionalisation process and she felt very tired after the process because she felt that in becoming part of those negotiations she had to fight to have her voice heard.
In cross-examination she stated that she submitted a letter of resignation on April 14, 2004 in which she informed Ms EL that she had been offered the post of principal social worker. In this letter she thanked Ms EL for all her kindness, support and flexibility over the last seven years.
The eighth witness on behalf of the claimant Ms JK told the Tribunal that she originally came from the teaching profession but she moved into third level education in the late 80s early 90s. She returned to education and completed two Postgraduate Diplomas in Management and Leadership in Trinity College and subsequently Master of studies in Workplace Bullying. She completed her masters in 1998 but was awarded her Masters Degree in 1999 at Trinity College. She lectures part-time in Trinity College on contemporary issues in management and a great part of that was on the subject of workplace bullying, awareness and prevention. She worked with companies both in the public and private sector around creating awareness on the whole area of the importance of a healthy psychological work environment and the prevention of bullying in the workplace. She would look at companies’ current policies and advise on what best practice *28 would be from around the world in terms of improving or changing them. She kept herself informed of all the literature and research on the subject both nationally and internationally. She advised universities, Institutes of Technology and schools. She also advised health boards, hospitals and government departments. In the private areas clients ranged from banks to pharmaceutical companies and computer companies. She was asked quite frequently to address seminars and conferences on the subject of workplace bullying and the area of positive work environment and appropriate management.
Ms JK stated that a written document was one small element in the whole anti-bullying programme. The main thing would be to look at the culture and the climate of the organisation to establish whether it was bullying promoting or bullying preventing. The anti-bullying policy would be part of that programme but it would have to incorporate certain elements for to be effective. Certain organisations would put in place a policy but it would merely be a paper exercise, it would not reflect what was going on in the organisation. Even the expression of intolerance would not reflect a genuine tolerance but that was not in all organisations. If the genuine desire was not there but simply the paper it was absolutely ineffective and as well as being ineffective it was deeply frustrating for the people who work in the organisation because they see it as being window dressing or a smokescreen. To ensure that employees received a copy of the anti-bullying policy was good practice in terms of formulating an anti-bullying policy. It should be done in consultation with all the interested parties. Then it should be communicated to every staff member through whatever means possible. It could not be ensured that everyone received it but it would be the intention that everyone would receive a copy. It was recognised that there was a need to provide the widest range of options for resolution. It would not just be about the formal, the investigative, it would be the widest range of options to incorporate informal opportunities for resolution. That took account of the fact that the research would show that for in excess of 90 per cent of people who made claims of bullying, their main aim was to have it resolved. There would be put in place in organisations specialist people in specialist roles that would act to support and outline these options. The informed choice that the majority of people made in the context of the range of options would be to opt for the informal route. One of the most important elements of the prevention of the bullying would be the adequate training of everybody who was put into a position of supervising or managing. That would be considered a very important part of the anti-bullying programme. The literature would suggest that the most prevalent type of bullying would be the systematic undermining of a person’s capacity to contribute to the organisation. It would be a discrediting of their previously good reputation, of their relationships, of their record of work. It would be a systematic discrediting so that they would be excluded and isolated within the organisation. It would be frequently conducted with a view to actually reducing them to such a state of *29 self-doubt and lack of confidence that they might leave of their own accord. There was a very recognised method and it was very prevalent in bullying situations and bullying cases described as the “the trawl” or “the hunt” . It occurred where someone was perceived as a threat, or someone whose competence undermined or highlighted the lack of competence of someone else, someone who resisted becoming a yes person, and someone who was intolerant of hypocrisy or bad practice and voiced that intolerance. In order to discredit that person a trawl would be done through their work, their relationships and their record in order to find incidents that could be accumulated to reflect badly on them.
The ninth witness on behalf of the claimant Ms MP told the Tribunal that the first job that she had was in Scotland as a court assistant. She then spent the next four years in East Africa. She worked there for the diocese of Eldret, which is an area the size of Munster. She was responsible for administrating the entire area and she spent four years there. She returned to Ireland to train as a nurse. While she was in Africa she discovered that there was a dearth of opportunities for people with disability so she thought if she came back and trained she could return with that particular skill. She met her husband during her training and she did not return. She had worked then for the John of God’s services for a number of years and then she applied for a post in the respondent in 1980. She was head of respite. As far as her memory served her it was the first respite house in Ireland that was community based. She was responsible for that unit for the following five years until the birth of her daughter. After the birth of her daughter she took two years’ leave of absence and then she decided that she did not want to return full-time. She enjoyed being at home and she did various part time jobs for a number of years within the respondent. Then her son was born and she eventually took up a part-time position in Aylesbury Respite in 1990. She has continued to work in that position since 1990. She was never subject to a complaint and she was in the fortunate position in that her work environment was challenging. She was asked to get involved in training. She had a particular interest in training and in working with groups of people. She helped people to manage diabetes in the community and was involved in first aid training. She stated that things changed dramatically in 2005.
She submitted a complaint in April 2005. It was the first time she had ever written anything of that nature because up to then she would have tried to deal with issues locally. Before she did that she had given it a great deal of thought. What happened subsequent to that has been a nightmare. She was deputy manager in the house when she made the complaint. She was suspended on December 22, 2005 on full pay and in mid-January 2006 she was suspended without pay. She was told she had failed to cooperate with the respondent investigations, and she admitted that she had failed to co-operate. She was told that an investigation team would be established. She had put in her complaint under bullying and harassment. In the initial correspondence this was never referred to, it was *30 always referred to as grievances. She had an issue with the composition of the committee who were going to undertake an investigation because she felt it was not independent. She wanted her complaint to be dealt with in accordance with the protocols relating to bullying and harassment. She felt that they were breached at every level. The respondent breached it in terms of the time that it kept the complaint before it was dealt with, in terms of the composition of the investigation team, and it was not independent. She objected as she felt that the investigating team should be agreed by both parties where possible. The chairperson of the team was an administrative manager in Goatstown and would have managed the person that she complained about for a short period. The second member was a colleague of the person she complained about at one time and the third person was new to the organisation and was in the HR department.
With the protocols that were in place the complaint would be addressed by Mr D, the regional manager and then he would allocate a team. She wrote to Mr D and outlined to him her frustration at how the process had been handled. In the letter she indicated that her role was being deconstructed. There was an exchange of letters between Mr D and the witness in December. Mr D undertook an investigation regardless of her concerns and he had the report and that was all he needed. She was going to be disciplined for not cooperating with the investigating team. She told her colleagues at this stage and she mentioned to them that she was sure she would be without a job by Christmas. She received a letter at 11.30 on Thursday morning asking her to confirm with management by 10.00 that morning if she could attend a meeting at 4 p.m. that afternoon. She responded immediately and she felt it was a form of pressure. She indicated that she would report for duty on Friday. She was informed not to report for duty on Friday, as it was unwarranted and illegal. She did not know what she was going to face. She got a couriered letter delivered to her home saying that it was rescinding the suspension but she was due to go to a meeting on the Monday to be censured. She went in to work on the Friday and she was ill by Sunday. She had a blood pressure problem from the previous August. She telephoned a colleague to see if she could replace her. Then the following Wednesday she received a letter suspending her on the Thursday before Christmas.
Respondent’s case
The deputy chief executive Ms PD told the Tribunal that she joined the respondent 29 years ago. She started as a social worker when she finished college. She was responsible for the administrative aspects of the organisation, the finance, human resources, training, research, property, maintenance, transport, and information technology. Mr K dealt with the services. When she joined in 1977 it was a relatively small organisation. It was beginning to have difficulties in relation to residential care provision. It was started as a day service and it was not until the late 1970s that the organisation actually had to face the issue of whether or not it *31 would develop residential services. The residential services that it provided was small houses in the community. It attempted to develop homes for people with disabilities. A huge expansion occurred in 2000, 2001 and 2002. It developed 70 individual home places for people. They were individual places where the individual need of each client was taken into account. The homes were located in the community. The respondent was a very flexible organisation and the goal was to ensure that the individual needs of people with disability were met. The organisation had grown in line with the identified needs of people with disability. It had respite services, home teaching services and schools. It had developed centres for children who were more profoundly handicapped and had greater needs. It had vocational training centres. It had independent work options where people were supported to go out and work in ordinary jobs. It had integrated education services where children were supported to belong in ordinary schools and in the community. It had recreational services and it had services to support independent living. It had part-time residential services and it had the complete range of options that would be needed by an individual at any stage in their lives.
The respondent was in serious difficulty in the early 90s in relation to residential care provision because it had a limited residential provision and the needs of parents were growing. At that point parents were getting older and some had died. This caused difficulties for the respondent. The catchment area of the respondent had the greatest level of need in all of Ireland. A database was developed for the whole country to show the needs for services and the term that was used in the health board to define the respondent catchment areas was the black hole. It had a priority listing of the greatest need. At any time it had the top 10 priorities. In the top 10 priority of the list of 300 was that both parents had to be dead which was a dreadful situation to be in. The respondent currently had a staff of approximately 1,500.
Between 2000 and 2003 the respondent developed 180 residential places, which was phenomenal growth and development by anyone’s standards. It was an amazing step forward for the organisation and it did actually have a significant impact on the waiting list. At that time they were opening a new house every seven weeks. In order to achieve that level of development you need to have maximum co-operation from all areas in your organisation. There was absolutely not a climate or atmosphere of bullying in the respondent. The organisation was restructured between 2001 and 2003 in order to cope with the very significant expansion it was undergoing and also the fact that it knew it had to expand further. The union became involved and represented staff over 10 months. The co-operation agreement was finalised in January 2003. As part of that process, which was minuted by the union, the minutes were all agreed by the staff, union and the respondent. Meetings were held every month between April 2002 and January 2003 and the unions at the start of the process asked all of the staff to *32 put forward every single issue of concern they had. Everything was to be put on the table and there was a list compiled at the start of the process.
Halfway through the process the union said that it would do a second analysis and any other issues that needed to be addressed could be compiled.
Ms PD stated that never in that 10-month period was the issue of a culture of bullying and intimidation in the respondent raised by the staff representative or the unions. The organisation needed to scale down and it was divided into three regions. In each region it reorganised the service delivery model. Prior to restructuring it delivered its services in divisions. It had a residential division and an employment and training division. When it regionalised the organisation regrouped the model into service clusters and each service cluster grouped together 150 people with learning disabilities with the same needs less than one team. The process that had been adopted with the unions allowed ultimately for arbitration on the issue, which it did and it was resolved.
At the hearing on January 18, 2006 Ms PD told the Tribunal that she wrote to the claimant on July 17. The meeting that she invited him to was not a disciplinary meeting; it was an informal meeting to raise issues of concern with the claimant. The board concluded its business with the claimant in December 2002. They were now getting back to the normal work of the organisation. The senior management team was precluded from raising any issues of concern with the claimant. In January they had discussions as a number of issues had arisen. At that point the claimant’s direct boss, Mr MM, his professional superior was absent on sick leave in January It took a number of months to replace Mr MM and a new acting head of the department was not formally agreed until May 29. As soon as the agreement was in place on May 29 Ms LW took up the role as acting head of department and as soon as the negotiations regarding pay and conditions were concluded with her she notified Ms LW that there were issues that she needed to discuss with her in relation to the claimant. She relayed all of the issues to Ms LW and she told her that she wanted her to discuss the issues with the claimant. Ms LW came back to Ms PD and informed her that she did not feel that she should do it. Ms LW told Ms PD that it would be very difficult for her to undertake this work with the claimant because she was the claimant’s work colleague. She was only in a temporary appointment and it was not clear when Mr MM was going to return to work. The second reason she gave Ms PD was that she felt the issues were such that the claimant needed to be heard at a more senior level than her. Those were the two points that she remembered Ms L. W making to her. Ms PD was clearly engaged in the process before receiving the claimant’s letter. The HR function reported to her and she was very clear when she engaged in an informal process. The informal process was whereby she stated her position and her understanding of events was that she allowed the other person to state their position.
Ms PD stated that the respondent explained to employees what constituted *33 gross misconduct. One of the breaches that it regarded as gross misconduct was leaving the job without authorisation. At the first meeting the claimant and his union representative listened to what Ms PD had to say. It was agreed that there would be a further meeting. The majority of the response was delivered by the claimant. At the end of the meeting there was a two-way discussion between the claimant and Ms PD. It was an informal process and it was the first time that they had engaged in dialogue. The claimant’s union representative suggested that the meeting be adjourned and reconvene at a future date. It was clear to Ms PD that she had obtained additional information around the actual issues. She needed to reflect on those and reverted to the claimant. It was only the start of the process. She had laid out all the information she had to the claimant. The claimant had come back and he had responded on every issue that she had raised and they were at a point where they began to dialogue together so that they could deal constructively with the matters. At no time at the end of the second meeting or at any time during either of the meetings did she determine that the claimant should be subjected to some disciplinary sanctions. She did not have enough information. The next thing that occurred in relation to the matter was on October 23 when Ms B wrote to the claimant’s union representative, The letter was signed by Ms B and was sent on the instructions of Ms PD. Ms PD then received a seven-page letter on Oh November from the claimant in which he reiterated much of what he had said at the meetings. Ms PD replied directly to the claimant’s union representative on December 5. During this time Ms PD met with Ms LW and she advised Ms PD that the claimant was getting impatient with the time lapse and that he was going to write to her. Ms PD asked Ms LW to ask the claimant not to write to her. Ms PD asked Ms LW to tell the claimant to contact his union official and ask him to get the matter back into the process. The letter arrived and she thought that it was best to write to the claimant’s union representative and ask him to deal with the matter. Ms PD again wrote to the claimant’s union representative on January 23 in which she restated that the respondent’s intention in the process, which was to resolve all of the issues as amicably and as fairly as possible and to move into a more constructive working relationship with the claimant.
Ms PD was not informed at any time between September and the end of January by either the claimant or his union representative that the union representative was no longer acting or advising the claimant. No one advised Ms PD that it was inappropriate that the correspondence should be going to the claimant’s union. At this time the claimant had not at any time in this period invited her to communicate with the solicitors or with anyone else in relation to this. Three collective agreements were in place with three trade unions, Impact, SIPTU and INO. It was the normal practice to engage in relation to individual employees through the trade union. No further meetings ever took place and the process never concluded.
*34
The second witness on behalf of the respondent Dr JL told the Tribunal that she qualified from the Royal College of Surgeons in 1981. She has an honours medical degree and a licentiate of the College of Physicians and Surgeons. She obtained her membership of the Royal College of Physicians in 1985. She was awarded her fellowship from the Royal College of Physicians in 1998. She also obtained her Diploma in Child Health in 1984. She was awarded and completed a higher diploma in medicine dermatology in 1998. She completed her general medical training and she undertook two years of research. She then went into the medicine of learning disability for adults with learning disabilities. Prior to that it would have been paediatricians who would look after the medical problems of people with learning disabilities but as they were living longer it was apparent that these people had more medical problems. There are currently more people now specialising in medicine for adults with learning disabilities.
She joined the respondent in 1987 and she left in 2004. She is currently employed by another service provider in a similar area. When she started working with the respondent she was a senior physician. The witness and another paediatrician undertook work and she built up a medical department, which provided a comprehensive specialised medical service for the adults and the children. This was a specialised service. She was not a GP or a hospital consultant; it was an intermediary between the two. They built up a large medical department and when she left there were three full-time physicians and a half-time adult post. There was also a paediatrician post that was job shared and there was a visiting consultant paediatrician, visiting eye specialist and it had consultant sessions from Beaumont in Ear, Nose and Throat.
In 2000 she was appointed the senior physician specialist in learning disability. This post was equivalent to a specialist in public health. She was involved in senior management as a representative of the medical department. The respondent did not want to send clients to nursing homes. She had worked in two learning disability services. She stated that no money could buy the commitment, care, love and attention that you will get in a learning disability service. The respondent had no option but to send people to nursing homes. Dr JL was frustrated about this and there were occasions that she wished that she could obtain about five ambulances and wheel those people into the Minister for Health or the health board to see what was happening in people’s homes trying to look after someone in their 40s, 50s or 60s She was there for 17 years and it was not like being in a hospital. She had built up a relationship with families. Some of her colleagues in the social work department as well as the claimant voiced objections regarding the use of nursing homes. The preferred option would be to remain with the respondent. There were people that the respondent could not provide services for.
Dr JL was involved in the decision to transfer Mr PMcK. The claimant had no involvement in that decision. The claimant was not Mr PMcK’s psychologist. *35 Mr PMcK was in a situation that the respondent could not look after him. He was in a temporary bed in a residential house in the Beeches. The bed was in a sitting room that was used by other clients in the Beeches and a number of these clients had fairly specific challenging behaviour. The only Alzheimer service that Dr JL was aware of was the Highfield Hospital. That was a private facility but it did not take the respondent’s patients. Nursing homes were being used by hospitals to transfer people with dementia. People go to nursing homes to either recover from surgery or they go to be nursed until they die.
Dr JL loved her work, it was dynamic and people worked hard. People were there because they genuinely loved it.
The third witness on behalf of the respondent Mr DK told the Tribunal that he was Human Resources manager in the respondent between 1995 and the end of 1999. He was now the HR Manager with Failte Ireland. When he joined in February 1995 staff levels were approximately 400 to 420. When he left in 1999 the staffing levels would have been approximately 900. He had a role in updating the personnel manual. An extensive consultation process was put in place. An advisory group was established to advise the HR department on the implementation of the HR policy and procedures throughout the respondent. It consulted with the trade union representatives at the time and with the heads of department. He lived in Stillorgan and head office relocated to Ballymun. He was employed for five years with the respondent and he felt it was time for a new challenge. During his time with the respondent he was not aware of any complaints of bullying.
In cross-examination by counsel for the claimant Mr DK stated that at the outset he had pointed out that the respondent had engaged in a process over two years where it had formulated policies and drafted policies. It met with the advisory committee and the trade unions so there was a process in place. Prior to November 1999 there was no policy in place in the company.
The fourth witness on behalf of the respondent Dr D told the Tribunal that he was a consultant psychiatrist. The respondent currently employed him. He completed his higher training in general psychiatry and also in psychiatry of learning disability. As part of that training he completed two years in the psychiatry of learning disability and between 2002 and 2003 he was employed as a senior registrar in the respondent half-time and a senior registrar half-time in the Daughters of Charity service. He completed a further year in general psychiatry and on July 1, 2005 he started as a locum consultant in the respondent and on December 19, 2005 he was appointed a permanent consultant psychiatrist. During the period 2002 to 2003 he did not observe any atmosphere of bullying or any atmosphere of harassment or abuse of staff. He did not observe any unacceptable atmosphere in the workplace.
The fifth witness on behalf of the respondent Ms GB told the Tribunal that she qualified as a social worker in 1985 from Trinity College, Dublin with a degree *36 and professional certificate. In 2002 she completed a Masters in Management specialising in Training and Education Management at Dublin City University. The respondent provided extensive training in relation to bullying in the work place. She did a review of the training since 2000 both on positive HR practice, dignity at work and anti-bullying practices. The respondent had spent a total of €16,700 on seminars and education events. She had been employed with the respondent for 18 years as training and development manager. She held two leadership positions within the respondent. One was at service manager level, which was middle management. She joined the respondent on an 11- month contract. She was employed as a special project worker developing a new innovative service. The respondent provided two challenging behaviour programmes. The first was the foundation level programme, which was a four-day programme that was run by the psychology team. All psychologists in the team run the programme. The second programme was a course entitled “Managing Assaultive Behaviour” . The respondent contracted the services of a UK company that specialised in a particular approach, which had a positive effect on behaviour that may be threatening or assaultive.
The respondent had a four-day in-house programme, which was copyright to the respondent’s training department. The programme was developed by two psychologists and it was one of the first jobs that Ms GB was commissioned to do when she started as training manager. The two psychologists were Mr MM, who was senior psychologist and the claimant. They both brought their expertise to develop a four-day programme and were freed up for an eight-week period to develop the programme. They then rolled out the programme to all front-line staff, care assistants, social care workers and nursing staff and other clinical staff also availed of that programme.
In 2001 the CEO announced that the respondent was to receive a total of €154,000 to provide training places for two services in the North Dublin area, which was the main catchment area. These two services were St Ita’s and Prosper Fingal. Prosper Fingal was a similar organisation to the respondent in that it had a community ethos. In 2001 the CEO was facing considerable cutbacks in that year and the respondent was grateful to receive additional funding of €154,000. The respondent was asked to provide a limited number of places for both Prosper Fingal and St Ita’s. The €154,000 meant that an above average number of unqualified staff could attend the Open Training College and commence their professional training to degree or diploma level. She was grateful for that funding as unqualified staff could complete their professional training. Thirteen staff from St Ita’s attended three programmes within the respondent. The first was in April 2002, the second in November 2002 and the final three St Ita’s staff attended a programme run in February 2003.
Prior to this staff attended challenging behaviour training, and attended a total of 13 courses run by clinical colleagues from the physio department, the *37 occupational therapy department, speech and language therapists some of her own staff and a health and safety trainer. There was only one complaint about the St Ita’s staff involvement, which came from the claimant. The claimant did not deliver all of the courses. Three staff were present at the course in April 2002 and there were no complaints arising from their attendance.
Ms GB first became aware of the claimant’s complaint about the presence of St Ita’s staff: the evening prior to the four-day programme at 4.50 p.m. The claimant informed Ms GB’s administrator that his objections were so grave that he could not proceed with being the lead trainer the next morning. The claimant was due to be assisted by a trainee psychologist Ms NH. Nineteen staff were due to attend. The crisis created by the claimant’s action was entirely unnecessary in her view. This situation had never occurred prior to or after this.
Ms GB was satisfied that consultation had taken place and there was no evidence to suggest that combining staff from St Ita’s with staff from the respondent produced a disruptive effect. It was unfair to the three St Ita’s staff who attended in April 2002 to describe them as disruptive when the claimant did not run that course or was not in attendance at it. There was only one occasion in the past when St Ita’s staff were present and that was in April of the same year. At the November meeting of the steering group it was minuted that Ms CD and Mr MM assessed that mixing staff from St Ita’s and staff from the respondent had a very positive effect. The respondent’s staff learned about the way services were provided in a different type of setting and St Ita’s staff who worked in a large institution learned about managing challenging behaviour in a community setting. The psychologist’s review of that, at the meeting, that she was involved in, was very positive.
She worked with the respondent for 18 years. She had three managers in that period who were currently members of the executive team. She had never experienced bullying and she stated that she would not remain in the employment of an organisation that had that culture. She was involved in regionalisation. The training department regionalised and she undertook that in consultation with the training team. The training team consisted of a team of five and a half posts and also in consultation with Ms PD. The regionalisation structure that ultimately was implemented was not imposed on her. It arose from the consultation process.
Determination
The Tribunal has considered the evidence adduced by the claimant and the respondent. The Tribunal has also considered the submissions made on behalf of the claimant and the respondent.
In the course of the hearing there were many references to the sad events at Leas Cross nursing home. This Tribunal has the utmost sympathy for the family of the late Mr PMcK. It must be clearly stated however that the events at Leas Cross nursing home were never matters for this Tribunal to adjudicate on. The *38 High Court and the reports of Mr MH made the decisions and investigations in these matters as it was rightly within their respective competencies to do so.
This Tribunal’s proper function was to adjudicate and determine a matter pertaining to the relationship between an employer and employee and in particular whether the claimant was constructively dismissed by the respondent. A key aspect of the constructive dismissal claim is that it was caused by “persistent and sustained bullying and harassment” .
The legal context is not in dispute namely (a) the onus is on the claimant to prove his case; (b) the definition in law of bullying contained in S.I. No. 17 of 2002 which states as follows: “Workplace Bullying is repeated inappropriate behaviour, direct or indirect whether verbal, physical or otherwise conducted by one or more persons against another or others, at the place of work and/or in the course of employment, which could reasonably be regarded as undermining the individuals right to dignity at work. An isolated incident of the behaviour described in this definition may be an affront to dignity at work, but as a once off, the incident is not considered to be bullying” and (c) the test for the claimant is whether it was reasonable for him to terminate his contract as applied in Allen v Independent Newspapers (Ireland) Ltd [2002] E.L.R. 84.
The task therefore for the Tribunal is to evaluate the evidence heard by it to ascertain whether the claimant had established a factual situation sufficient to bring him within the aforesaid legal parameters. Furthermore the necessary source of evidence in this matter is that produced by the claimant and his fellow employees supplemented where relevant to this employer/employee dispute by other relevant witnesses outside the employment nexus.
Ms DK a former employee of the respondent, itemised in her evidence five instances of alleged bullying by the respondent, an intimidatory response to her questions about holidays, a similar attitude by the respondent to her questions about its use of nursing homes, the inappropriate use by the respondent of an employee assessment folder, her exclusion from a key client of the respondent in the autumn of 2001 and the closing of a residential home. Ms DK left the employment of the respondent in April 2002.
The Tribunal is satisfied that the matters recited by Ms K are such as arise in the normal functioning of a work organisation, particularly one like the respondent, which was growing rapidly at this time. This evidence as to these items does not individually or collectively amount to evidence of bullying.
Dr H is a general practitioner. He had two consultations with the claimant after he had terminated his employment with the respondent. Dr H did not make any formal diagnosis as to the claimant’s condition. This witness did not produce any adequate evidence of bullying by the respondent.
Mr CR another former employee of the respondent was upset that his fixedterm contract with the respondent was not renewed. He said in his evidence that he was not bullied.
*39
Mr FF gave hearsay evidence to the Tribunal about complaints made to him by employees of the respondent about bullying. These complaints were made by Ms K and a Mr PMcD. The Tribunal has already evaluated the evidence of Ms DK. Mr FF did not provide any specific detail of the alleged bullying of Mr McD.
Ms AO’N another former employee of the respondent, gave evidence about what she considered was an atmosphere of intimidation within the respondent’s organisation during her employment there. She was particularly aggrieved that after 18 months’ employment with the respondent she was expected to work a probation term with the respondent to secure further employment with the respondent.
Ms AO’N gave evidence that a couple of months before she left the respondent’s employment she applied for a senior position within the organisation. The Tribunal considers it a reasonable inference on its part that this job application by Ms O’N indicated that for her the working environment was satisfactory and was not one where bullying occurred.
Ms EL another former employee of the respondent gave evidence of what she considered an intimidatory style of management in the organisation. When giving details of this she cited the case of A O’N and Mr CR. This evidence has already been evaluated by the Tribunal.
Ms MP gave evidence of making a complaint about bullying by a work colleague. This event occurred in September 2004 which post-dated the claimant’s resignation from the organisation. Ms MP did not participate in the enquiry mechanism into her complaint as she deemed it unsatisfactory. She was suspended from work on December 22, 2005 on full pay and in the middle of January 2006 she was suspended without pay. She admitted in her evidence that the reason for her suspension was her failure to cooperate with the enquiry mechanism. The Tribunal considers that this witness’s evidence did not establish the existence of bullying within the respondent.
Ms JK was called by the claimant as an expert in bullying. Ms K in her evidence did not refer to S.I. No. 17 of 2002. The Tribunal considers it appropriate to focus on this statutory instrument, which was of course endorsed in the legal submissions to the Tribunal.
The Tribunal therefore considers that the totality of the foregoing evidence does not establish the existence of bullying within the respondent’s organisation. It should also be borne in mind that at this period the respondent employed in the region of one thousand persons.
It finally falls to the Tribunal to consider the claimant’s evidence. This can conveniently be divided into two time periods, September 3, 2001 to July 16, 2003 and July 17, 2003 to April 6, 2004.
In the first time period the claimant wrote to the respondent’s board expressing grievances about the policy of the respondent and about the alleged bullying of *40 another employee. In response to this the respondent offered an enquiry composed of three managers within the organisation, as specified in the respondent’s grievance procedures. The claimant would have a right of appeal to a Rights Commissioner or the Labour Relations Commission. The claimant objected to the composition of this enquiry panel.
Subsequently, the respondent offered a three-person sub-committee of the board to consider the claimant’s grievances. The claimant refused to participate in this enquiry because he stated one member of the sub-committee had a significant business relationship with the respondent.
The Tribunal considers that the claimant did not act reasonably in refusing to engage with the two processes made available to him by the respondent. It was open to him, if he considered the outcome of the internal managerial enquiry unsatisfactory to appeal to independent agencies outside the respondent’s organisation. Again, with reference to the board’s sub-committee the claimant never suggested that the board member to whom he objected had failed to make any declaration of interest required by him by law. This board member had a close relative who was a client of the respondent. The Tribunal considers it a reasonable inference on its part that this board member had a similar concern as the claimant in the welfare of the respondent organisation.
The Tribunal also considers it significant that the claimant produced no evidence to the Tribunal as to the alleged bullying of an employee of the organisation, which was contained in his letter to the board of the respondent dated September 3, 2001.
The second time period relating to the claimant’s evidence begins when he received a letter from Ms PD dated July 17, 2003. In his evidence the claimant stated that it was only from this time that he felt personally bullied inasmuch as the issues raised by Ms PD in her letter were being used to intimidate him. Subsequent to this letter a meeting was convened which was attended by among others, Ms PD and the claimant with his union representative. The meeting was reconvened on September 25, 2003 when the claimant in the presence of his union representative responded to the issues Ms PD had raised in her letter dated July 17, 2003.
After this meeting Ms PD wrote on a number of occasions to the claimant’s union representative and also to the claimant’s solicitor in order to progress the matter. The Tribunal considers this was a reasonable course for Ms PD to take given her evidence to the Tribunal as to why she took this course.
There was certain vagueness in the claimant’s evidence as to why the claimant’s union representative did not engage with the respondent after the meeting of September 23, 2003. The Tribunal considers it a reasonable inference on its part that sometime after September 23, 2003 the claimant had decided to pursue his issues with the respondent outside any forum provided by the respondent and by way of the statutory legal process open to him.
*41
The Tribunal notes that it was suggested that Ms PD had departed from her course of dealing with the claimant’s union representative when she wrote a letter to the claimant on January 14, 2004. The Tribunal accepts the evidence of the respondent that this letter related to the investigation relating to client care and not to any employer/employee dispute. Ms FD’s evidence that 22 other people were interviewed about this matter was uncontested at the tribunal.
The Tribunal finds that the claimant’s behaviour subsequent to September 23, 2003 again exhibits a lack of engagement by him with the processes available to him within the respondent’s organisation to deal with his complaints
In her book Dismissal Law in Ireland (2002) Ms Redmond states at paragraph 19.18 “there is something of a mirror image between ordinary dismissal and constructive dismissal. Just as an employer for reasons of fairness and natural justice must go through disciplinary procedures before dismissing, so too an employee should invoke the employer’s grievance procedures in an effort to resolve his grievance. The duty is an imperative in employee resignations” .
The Tribunal finds that there has been a consistent pattern of lack of engagement by the claimant with the respondent’s grievance procedures. The Tribunal consequently finds that the claimant acted unreasonably in terminating his employment contract with the respondent. The claim for constructive dismissal by the claimant under the Unfair Dismissals Acts 1977 to 2001 therefore fails.
Aengus Mannion v Carmel Naughton and Martin Naughton
UD749/2011; MN811/2011; WT311/2011
Employment Appeals Tribunal
9 December 2013
[2014] 25 E.L.R. 36
The respondents, a married couple, are the owners of, inter alia, a farm. The farm is approximately 350 acres in size and forms part of an estate. The couple have other business interests, which are the primary concern of the second-named respondent. The first-named respondent had greater involvement with the estate. The claimant was employed as farm manager in 2004. His role included the purchase and sale of cattle and the preparation, subject to the approval of the first-named respondent, of an annual budget. In addition to his salary, the claimant was entitled to the reimbursement of expenses, which included the rent on his accommodation.
The claimant’s employment appears to have progressed to everyone’s satisfaction and he had a good relationship with the respondents. Indeed, he considered it his dream job.
*38
In May 2009 the claimant suffered an accident on the farm when his legs were pinned against a tree by a teleporter. He received serious injuries and it seems that, at one point, serious consideration was given to the amputation of his legs. He was hospitalised for about five weeks which time there was significant surgical intervention followed by a long period of recuperation. During this time it was made clear to him that his job was being kept and he was paid during this period of absence. Prior to his return to work, the first-named respondent required that he be certified as fit for work by his orthopaedic surgeon rather than his general practitioner. In the circumstances and given the nature of his work this does not appear to the Tribunal to have been an unreasonable requirement.
While still in hospital, the first-named respondent told the claimant that a new estate manager had been engaged. This was JM who had worked for a meat factory and with whom the claimant had had a business relationship over the years. She was anxious to tell the claimant herself so that she could explain it to him before he heard it from another source and be concerned. She told the Tribunal that the farm labourer had in the first instance taken care of the farm in the aftermath of the claimant’s injury with the assistance of the neighbours. This was not a situation that could continue into the medium term and one neighbour recommended JM, in part because of his business relationship with the claimant. JM was engaged. In or around that time the respondents had been considering scaling back their business activities and travelling more. As a result, the first-named respondent would be less available to oversee the running of the estate. They had been considering the engagement of an estate manager and quickly realised that JM was what they were looking for. The claimant was assured that his job was safe, only that he would on his return answer to JM rather than the first-named respondent.
The claimant gave evidence about two matters that arose before his return to work; first, that he was asked to remove his dog from the farm and secondly in relation to his jeep. The Tribunal is satisfied by the evidence given by and on behalf of the first-named respondent in both these matters and is not satisfied that either were such as would justify a claim for constructive dismissal.
The claimant returned to work in March 2010. The first-named respondent was anxious that he ease himself back in for as many hours and days each week that he felt able for. He continued to be paid in full. He felt that he was being given menial tasks, such as weeding and fence-painting. The Tribunal is satisfied that such tasks were always part of his duties. However, JM continued to have charge of the purchase and sale of cattle and the preparation of the farm budget. The lack of responsibility for cattle trading appears to have weighed heavily on the claimant. It was clearly part of the job that he loved and took much pride in. He had won an award for production of beef animals. Further, the attendance at marts gave him, he felt, a status in the community together with a social outlet. It seems to the Tribunal that what had started as a stopgap measure had become *39 a permanent arrangement. JM told the Tribunal that the first-named respondent had made cattle trading his responsibility and that, as estate manager, he now had responsibility for the maintenance and responsibility of the farm. In addition, on his return to work, the claimant told the Tribunal, he no longer had access to his office and his belongings had been removed. Both JM and the first-named respondent told the Tribunal that the farm office had always been and continued to be a communal office from which the claimant was not excluded. Neither knew what had become of his belongings. JM told the Tribunal that, while the filing cabinets were kept locked, the key was on a hook by the door as, in addition to papers, it was where veterinary medicines were kept and access had to be allowed. The Tribunal accepts that it was a communal office and that the claimant was not excluded from it.
Following his return to work the claimant’s expenses and rent were not reimbursed. This was a source of grievance to him. The tribunal is satisfied that the procedure for reimbursement was that the claimant had to produce vouchers to the respondent’s accountant who would arrange payment. The claimant accepted that after his return he did not produce any vouchers and did not raise the matter with the respondents. The Tribunal is satisfied that the non-payment of expenses could not, therefore, reasonably constitute a ground for constructive dismissal.
The claimant required further surgical treatment in the summer of 2010. Through the ensuing months, though, he appears to have become increasingly disillusioned with the job. He discussed matters with the first-named respondent in September 2010 and with the second-named respondent in December 2010 but there was no, from his perspective, satisfactory resolution. After his Christmas holidays, the claimant was once again on sick leave. He met the first-named respondent in early February 2011 in what he described as a negative meeting. In the course of the meeting he made certain allegations about JM. This meeting appears to have greatly affected the claimant and he was not well after it. At some point thereafter his solicitor wrote to the respondents in the course of which it was stated that it was the claimant’s belief that the respondents no longer intended to honour his contract and that he had instructed the institution of unfair dismissals proceedings. The letter also referred to proceedings for personal injuries and under the Employment Equality Acts.
The Tribunal is satisfied that the first-named respondent was at all times acting in what she thought were the claimant’s best interests. During the course of his lengthy absence she always assured him that his job was safe and paid him all the while. On his return to work she was anxious to ensure that the claimant was eased back in and not over-burdened in any way. In many ways this relationship went beyond that of ordinary employer and employee and was, on some ways, almost quasi-familial. Further, the respondents were certainly entitled to arrange their business as they saw fit, particularly to take account of their anticipated reduced role therein. While the claimant was, to an extent, *40 aggrieved that he had not been given the opportunity to apply for the role of estate manager, the respondents were under no obligation to do so and were entitled to engage the, in their opinion, most suitable person. They were also entitled to ensure that the claimant’s duties were performed both during his absence and during his recuperation in the job. However, the Tribunal is satisfied that the claimant’s duties had, to a significant extent, been taken over by JM and that this was a permanent arrangement. The principal duties of the farm manager were the general maintenance of the farm, the purchase and sale of cattle and the preparation of the annual budget. The claimant was no longer to have a role in the latter two. In reality, control of the farm had passed to JM. The Tribunal is satisfied that this was not a temporary measure pending the claimant’s return to full health but a permanent fundamental change in duties. Of course the claimant could have continued in his reduced employment and been paid as he had been therefore. However his real satisfaction in the job was derived from the trading in cattle and their production as beef animals. This was no longer to be his job. This is, in many ways, a sad case where the views of the claimant and of the first-named respondent as to what was in the claimant’s best interests did not coincide. The Tribunal is satisfied that the breach of the claimant’s terms of employment was so fundamental that he was entitled to resign his employment and that such resignation amounted to constructive dismissal.
The Tribunal is satisfied that the claimant took steps to bring his grievance to the attention of the both respondents.
It was submitted that this claim to the Tribunal was an abuse of process in circumstances where he had also instituted proceedings under the Employment Equality Acts and two High Court personal injuries summonses. The claims under the Unfair Dismissals Acts and the Employment Equality Acts are mutually exclusive. The claim before the Tribunal proceeded to hearing first thereby prohibiting the employment claim, a fact acknowledged by counsel for the claimant. The Tribunal is satisfied that a claim under the Unfair Dismissals Acts and High Court proceedings for personal injury are not mutually exclusive and can only assume that any compensation that might be awarded would be discounted by from any claim for loss of earnings in the High Court proceedings. The Tribunal is not satisfied that this claim amounts to an abuse of process and is satisfied that it is a claim that the claimant is entitled to make.
While the claimant initially sought reinstatement as a remedy, the Tribunal was told that his preferred remedy is now compensation. It seems to the Tribunal that reinstatement would be an unusual remedy in a case of constructive dismissal. That is not to say that it could not be a remedy. In the instant case, having considered the circumstances and the preferences of the parties, the Tribunal is satisfied that compensation is the appropriate remedy. Following his resignation the claimant required treatment for chronic stress and associated conditions which interfered with his ability to find alternative employment. His general practitioner *41 told the Tribunal that the principal cause of his symptoms was his rumination on what he perceived as his unfair treatment. The Tribunal notes, however, that he has been seeking alternative employment.
In the circumstances, and taking account of his on-going duty to mitigate his loss, the Tribunal awards compensation of €40,000 as being just and equitable in the circumstances pursuant to his claim under the Unfair Dismissals Acts, 1977 to 2007.
In the circumstances of his resignation the claim pursuant to the Minimum Notice and Terms of Employment Acts, 1973 to 2005 is dismissed.
No evidence was adduced to substantiate a claim under the Organisation of Working Time Act 1997, which claim is dismissed.
Brown & Anor v Neon Management Services Ltd & Anor
Employer repudiation
(Rev 1) [2018] EWHC 2137 (QB) (10 August 2018)
MR JUSTICE CHOUDHURY :
Introduction
The First and Second Claimants, Mr Brown and Ms Bhoma, are former employees of the First Defendant, Neon Management Services Ltd, and the Third Claimant, Ms O’Reilly, is a current employee serving her notice. The First Defendant is the management service company of the Second Defendant, Neon Underwriting Ltd, a Lloyd’s syndicate providing insurance and underwriting services in respect of financial transactions.
The Claimants complain that the Defendants breached their contracts of employment by, amongst other things, failing to pay salary increases and discretionary bonuses that had been awarded to them, making the salary increases and bonuses conditional upon acceptance of detrimental new contractual terms and the removal of profit commission (“PC”) agreed at the time of their recruitment. The Claimants contend that those breaches individually and cumulatively amounted to a repudiatory breach of contract entitling them to resign. They resigned on 16 March 2018. Those resignations were on notice. Thereafter, the Claimants, and in particular the First and Second Claimants, contend that the Defendants committed further repudiatory breaches of contract by, amongst other things, failing to pay the salary increases and bonuses, failing to pay PC and/or calculating the PC on a basis that was contrary to that which was agreed, making unjustified finding of misconduct on their part and reporting such conduct to their regulator. The First and Second Claimants accepted that alleged repudiation by resigning with immediate effect on 1 May 2018.
The Claimants seek damages. The First and Second Claimants also seek declarations that they were wrongfully dismissed, with the effect that contractual post-termination restrictions (“PTRs”) fall away in accordance with the principles established in General Bill posting Ltd v Atkinson [1909] AC 118.
The Defendants deny that there were any repudiatory breaches. They say that they were contractually entitled to make the salary increases and bonuses subject to the acceptance of more extensive PTRs, that the other contractual changes were not detrimental, that the Claimants fundamentally misunderstood how the PC is to be calculated, that the findings of misconduct and reporting of that misconduct to Lloyd’s were perfectly warranted given the First and Second Claimants’ various breaches of contract and company policies in sending highly sensitive confidential information to their private email addresses shortly before their collective resignations on notice. In any event, say the Defendants, even if there were breaches of contract the modern legal position is that the PTRs do not automatically fall away and continue to be enforceable.
Procedural background
On 15 May 2018, the Claimants issued their Claim and made an application for trial to be expedited. A few days later they filed and served their Particulars of Claim. By consent, on 21 May 2018, it was ordered that the trial of the issues be determined on an expedited basis with the trial to commence on 9 July 2018 or as soon thereafter as convenient. On 4 June 2018, the Defendants served their Defence and Counterclaim. The Counterclaim comprised a claim that the First and Second Claimants’ repudiatory conduct had caused substantial losses to the Defendants. Those losses were said to be in the region of £1 million. On 11 June 2018, the Claimants served their Reply and Defence to Counterclaim. Following standard disclosure, witness statements were exchanged on 3 July 2018. The trial in this matter then commenced just a week later on 10 July 2018.
Witnesses
There is little in the way of disputed fact in this matter although certain matters, such as the proper interpretation of what was agreed in relation to the PC and the reasons for resigning, are hotly contested. The Claimants each gave evidence in support of their claims. Ms Bhoma was the first to give evidence. The Defendants criticise that evidence as being partisan and not a true reflection of the facts. Whilst I accept that her evidence as to the effect of her PTRs was inaccurate and that she appeared in one small respect to change her evidence in the course of cross-examination to suit the Claimant’s case as to the PC, in general, I found her evidence to be credible and consistent with the contemporaneous documentation.
The next witness was Mr Brown. His evidence was less satisfactory. There is some substance to the Defendants’ criticism that his evidence was sometimes hesitant and unfocused. Particular criticism was made of the difficulty Mr Brown had in accepting relatively innocuous propositions such as the fact that the Claimants had agreed to join Neon as a team and that he had negotiated the PC element of their remuneration on their behalf. However, rather than being indicative of a witness who was being evasive, it seems to me that Mr Brown’s faltering performance in the witness box was largely down to his natural cautiousness and being overly defensive. His evidence as to key issues was largely consistent with the contemporaneous documentation. For the reasons set out below, I do not consider that he sought to change his case as to the basis on which he believed the PC would be calculated. I do not, therefore, accede to the Defendants’ invitation to reject Mr Brown’s evidence in this regard.
Ms O’Reilly’s evidence, by contrast with that of Mr Brown, was clear, cogent and largely unperturbed by cross examination. She was incorrect in one respect in relation to her understanding of the PTRs. However, she readily accepted that she was wrong, and her evidence was otherwise consistent with the contemporaneous documentation.
Other live witnesses for the Claimants were Mr Ross Louden, Deputy Chief Underwriting Officer of Axis Capital, the second lead insurer behind Neon under a consortium agreement for 2018 between Neon, Axis and several other insurers, and Mr Andrew Thornton, an underwriter in the Claimants’ team at Neon. Mr Louden’s evidence included a reference to a meeting he had had with Mr Brown on 19 March 2018, shortly after Mr Brown had tendered his resignation on notice. Mr Louden admitted that he had misled Neon in subsequent communications as to that meeting and his knowledge of Mr Brown’s resignation. However, despite starting his evidence “on the back foot” for that reason, I found Mr Louden’s evidence to be otherwise clear, credible and consistent with the other evidence before me. Mr Thornton’s evidence was largely uncontroversial and no particular criticism is made of it by the Defendants. A further written witness statement from Mr Rowley Higgs, an insurance broker, was admitted unchallenged.
The Defendants called four witnesses. These were Ms Caroline Andrew, Neon’s Global Head of Human Resources, Mr Ian Harman, Neon’s Head of Finance, Mr Andrew Dougall, Deputy Active Underwriter and Head of Casualty Lines, and Mr Brown’s line manager, and Mr Alistair McKay, Neon’s General Counsel. None of these witnesses could give direct evidence as to the recruitment of the Claimants and the terms of their remuneration as they were not involved at that time. Each of them gave evidence in a straightforward manner, making concessions where appropriate, although some aspects of their evidence were not accepted. I shall refer to some of those concessions and those aspects where relevant below.
Factual Background
The Defendants, to whom I shall also refer collectively as “Neon”, were previously known as Marketform and are part of the Great American Insurance Group, a multinational insurance group operating in a number of countries. In 2014, Neon was a loss-making syndicate with no significant presence in the M&A underwriting market. It sought to establish itself in the M&A market by recruiting a market-leading team. Neon’s enquiries led it to identify the First Claimant, Mr Brown, who was then working for Pembroke Managing Agency Ltd, as a suitable candidate to lead such a team. Other key recruitment targets identified at that time were the Second and Third Claimants, Ms Bhoma and Ms O’Reilly, both of whom were then also working for Pembroke.
In about October 2014, Neon approached Mr Brown and asked him whether he would be interested in joining Neon to head up a new M&A division. Mr Brown was interested, and soon afterwards, in December 2014, he met with a number of senior executives from Neon and related companies. He entered into discussions with Mr Simon Lotter, the then Chief Underwriting Officer at Neon, and Mr Scott Gregory, the then Communications and Marketing Director at Neon.
During these early discussions, Mr Brown was told that Neon could offer a ring-fenced profit commission scheme enabling him to share in the profits of the M&A class of business. This was important to Mr Brown because Neon was, at that time, a loss-making syndicate whereas he believed the M&A class would be highly profitable. It was also very important to Mr Brown that there should be a PC scheme enabling him to share in profits rather than risk relying entirely on a discretionary bonus. It was agreed between Mr Brown, Mr Gregory and Mr Lotter that they would negotiate and agree a set of terms to form Mr Brown’s contract and that these terms would be reflected in the employment contracts of any other persons joining the M&A division at Neon around that time.
On 30 January 2015 at 18:15, following one of these ongoing discussions, Mr Gregory sent Mr Brown an email with the subject matter, “Info as discussed” attaching Neon’s existing PC rules and a proposed PC calculation. Mr Brown noted that the proposed formula featured a PC calculated at 6% of a notional profit figure. Mr Brown required a higher percentage figure closer to 10%. Mr Lotter explained to Mr Brown that the PC rules had been set up across Neon and could not be varied. However, Mr Lotter said that it would be possible to agree changes to the way in which the PC was calculated under those rules.
Mr Brown and Mr Lotter had several discussions about the calculation of PC. One particular feature discussed was the loss ratio that would be taken into account in calculating the profit for the purposes of the PC. The loss ratio for these purposes refers to the total claims expressed as a percentage of total premiums in the same period; clearly, the lower the loss ratio the greater the likely profit and therefore PC. Mr Brown’s historic loss ratio was about 3% and, whilst on the Pembroke consortium, was in the region of 1%. It was expected that the M&A team at Neon would perform at similar levels resulting in a loss ratio in the region of 1 to 3%.
Mr Brown’s unchallenged evidence as to his discussions with Mr Lotter as to the loss ratio was as follows:
“24 I found that the PC Rules were just not easy to understand, so I relied on Mr Lotter’s explanation. I had several discussions with him over the calculation. Among other aspects of the calculation, we discussed in some detail the loss ratio that would be taken into account in calculating the class profit for the purposes of the PC; there was clear agreement between us that this calculation of the loss ratio would use actual losses including a best estimate of the most likely outcome of notified claims only and not a general provision for incurred but not reported losses. Mr Lotter told me that “Best estimate” was the best estimate of the likely outcome of notified claims. I verified with Simon that this loss ratio for the PC was not to include any element of IBNR (incurred but not reported losses). Had it done so, then there would have been a very different outcome for the calculation of the PC (and I would definitely not have accepted it).”
Another feature discussed was the figure for the Gross Ultimate Loss Ratio (“GULR”). GULR reflects an estimate of the final loss figure at the expiry of the policy period. The policy period is generally seven years and the actual losses incurred during the period would not be known until the end of that period. However, it is common to apply an estimate of the ultimate loss ratio for the purposes of calculations undertaken prior to the end of the period. The GULR figure is established by a team of actuaries, finance teams, claims teams and underwriters. It is, by its very nature, an estimate and is not directly related to the number of actual reported claims that may have been made by any given time. Typically, in the M&A class of business, the GULR at the inception of the transaction might be in the region of 60%, dropping to around 45% after a year and then to around 25% after two years. GULR continues to reduce year-on-year until the close of the book after the seventh year of the policy period when the GULR would be the actual loss incurred during the whole risk period.
In the spreadsheet attached to Mr Gregory’s email, the figure for GULR was recorded as 20%. Mr Brown’s unchallenged evidence was that in all of his discussions regarding the GULR, he was told by Mr Lotter that this was just a notional figure and that it would be replaced by the actual loss ratio for the purposes of calculating the PC.
Mr Gregory sent a further email on 30 January 2015 at 19:00 headed, “Answers to q’s”, in which Mr Gregory said as follows:
“Rob
I’ve spoken with Simon re your 3 questions.
To reconfirm the loss ratio figure of 20% in the calc is an example number. The calc will be based on actual at the close of say 2015. The PC payment would then be paid after the close of the year and therefore for 2015 early 2018.”
Mr Brown was reassured by this response that the PC for the M&A division would indeed be calculated on the basis of actual figures as opposed to the notional GULR on the spreadsheet. I shall say more about the effect of these exchanges below.
There were further negotiations throughout the month of February 2015. It was agreed that the allocation of the PC pool would be agreed each year with Mr Brown’s input. I should note here that the Claimants’ pleaded case was that the discretion to allocate lay with Mr Brown alone. During cross-examination, Mr Brown accepted that that was incorrect and that the position was in fact as set out in his statement, namely that the allocation would be determined by Neon with Mr Brown’s input. The significance or otherwise of this error is also considered below. Other matters agreed were that 9.4% of the M&A profit for each year of account would go into the PC pool. Various iterations of the PC calculation were exchanged at this time, all of which referred to the notional figure of 20% for GULR. Mr Brown was not concerned by these references given the agreement he believed had been reached as to the losses that would be used to calculate PC.
It was further agreed that 70% of PC would be paid after one year following the end of the relevant underwriting year, with the remaining 30% not being due until the following year. If there was any reconciliation required, then it would be carried out at this stage when the remaining 30% was to be paid.
Mr Lotter was also engaged in discussions with Ms Bhoma. In an email dated 5 March 2015, Mr Gregory responded to certain queries that had been raised by Ms Bhoma as to the terms of the proposed PC. In response to a request for confirmation of the employee profit share percentage, Mr Gregory said as follows:
“The Marketform PC scheme works on the basis of a fixed percentage of the line of business result and also a fixed percentage of the overall syndicate… result. The PC calculation is on actual numbers. We recognise that we need to give you more certainty than an interim discretionary arrangement for the 2016 and 2017 years. I’ve tonight sent a proposal to our Remuneration Committee and anticipate getting back to you regarding this tomorrow.”
Ms Bhoma regarded this response from Mr Gregory as significant. She wanted to be rewarded for actual profitability such that only actual losses were used in the calculation as she was confident, given the Claimants’ track record at Pembroke, that such losses would be low.
It is clear from internal communications at that time that Neon was particularly keen to recruit the Claimants. By an email of the same date, Mr Lotter wrote to other managers at Neon about the potential recruitment of the Claimants in the following terms:
“The bottom line is if we don’t do this or find another solution very quickly, they will not join us as they don’t want to walk away from two years of meaningful bonuses. I don’t believe they are talking to anyone else but I’m sure others would match this or more.”
Ms O’Reilly was working for Pembroke in Singapore at this time. She was very keen to stay there as she had built a successful book of business in that region and wanted to grow that book further. When she was contacted by Neon she expressed her reluctance to leave Singapore and her reservations concerning Neon’s poor loss record. She was concerned to ensure that the bonus for the M&A team if she were to join was separately ring-fenced. Ms O’Reilly was happy to let Mr Brown and Ms Bhoma take the lead in finalising the terms of the PC scheme with Mr Lotter and Mr Gregory, and she trusted them to negotiate the best PC deal on her behalf. By March 2015, Mr Brown was in a position to inform Ms O’Reilly that an agreement had been reached that the M&A PC would be ring-fenced from the wider performance of Neon so that the team would receive a share of the net profit generated for a given year of account. From her conversations with Mr Brown, Ms O’Reilly understood that the PC calculation would be based on the actual results as it was her view that this was the only way one could directly and reliably reward diligent underwriting and low losses. At no point did she think it would be based on estimates which she considered could be arbitrary. Ms O’Reilly accepted that figures for GULR, if prepared by actuaries as described above, would not be arbitrary.
On 6 March 2015, Ms Dawn Kempson of Neon sent emails to each of the Claimants attaching an offer letter of the same date. That offer included the text of Mr Lotter’s email of the same date in which the terms of a guaranteed profit commission amount for the 2015 account were set out. Between 6 and 11 March 2015, each of the Claimants accepted offers of employment and agreed to PTRs. In doing so, Mr Brown turned down approaches from more established insurers and higher counter-offers from Pembroke to join Neon. Mr Brown also had various family commitments which meant that it was important for him to be able to earn meaningful PC bonuses. The First, Second and Third Claimants commenced working for Neon in December, September and June 2015 respectively.
The Contracts of Employment
Each of the Claimants’ Contracts of Employment contained the following express terms, amongst others:
i) that each Claimant’s “Basic Salary will be reviewed annually, with effect from 1st January in each year commencing in 2016.”
ii) that Neon “may, without obligation, pay you a discretionary bonus in such amount, calculated on such basis, and payable at such time or times as [Neon] shall, in its absolute discretion think fit. You acknowledge that you have no contractual right to receive a discretionary bonus until it is declared in writing in respect of the financial year to which it relates and that you will not acquire such a right on the basis that during the Employment you have already received one or more bonus payments.”
iii) that the Claimants would each be required to enter “Restrictive Covenant Agreements” which, together with those sections of the First Defendant’s “Employee Handbook” marked as having contractual force, would form part of the terms of their Contracts of Employment; and
iv) that each of the Claimants would be entitled to pension contributions made by Neon based on their base salary. For Mr Brown this was 12.5% of his base salary, for Ms Bhoma this was 10% of her base salary, and for Ms O’Reilly this was 5% of her base salary (subsequently increased to 7.5%).
As to bonuses, the contracts provided:
“7.3 In addition, Marketform may, without obligation, pay you a discretionary bonus in such amount, calculated on such basis, and payable at such time or times as Marketform shall, in its absolute discretion think fit. You acknowledge that you have no contractual right to receive a discretionary bonus until it is declared in writing in respect of the financial year to which it relates and that you will not acquire such a right on the basis that during the employment you have already received one or more bonus payments. Marketform reserves the right at its discretion to vary or withdraw the terms of this discretionary scheme at any time
7.4 You shall not be entitled to receive a discretionary bonus if on the date that the bonus is due to be paid you are no longer employed (for whatever reason and howsoever caused and whether the termination of the Employment was in breach of contract or otherwise) by Marketform or any Group Company or you are under notice of termination of employment (whether such notice is given by you or Marketform) or on Garden Leave, or subject to disciplinary investigation, or suspended pursuant to the terms of this agreement.”
The PTRs were largely identical as between the Claimants, save that there were differences as to the duration of the restrictions post-termination, with Mr Brown being subject to longer periods of restriction. Clause 5 of the PTRs provides that Neon:
“…reserve[s] the right to review the restrictions contained in this Agreement from time to time and in particular in conjunction with any pay review or bonus award and make it a condition of acceptance of any such pay review or bonus award that such restrictions are re-affirmed or new or revised restrictions are entered into.
Whether or not that clause entitled Neon to introduce the disputed changes to the Contracts of Employment in this case is considered below.
Time at Neon
Mr Lotter was dismissed by Neon soon after Ms Bhoma commenced employment. Around that time, a new CEO, Mr Martin Reith, was appointed. Mr Reith established a task force to review the business which was continuing to lose money.
At a meeting with Mr Ian Martin, Managing Director, and a member of the task force, the M&A team were told that the wording of their contracts was considered to be ambiguous and that Mr Martin would prefer another letter to be sent to clarify those terms. Mr Martin reassured the team that any changes to the PC scheme would not be to their detriment.
On 8 February 2016, Ms Bhoma and Ms O’Reilly received letters headed, “Contract of Employment Amendment”. The letter was said to contain “explanations and amendments” in relation to the recipient’s entitlement to the PC. In respect of the 2016 year of account, the letter provided:
“you will be entitled to participate in the M&A bonus pool. An estimate of the ultimate financial performance of the M&A class for the 2016 YOA will be made in the final quarter of 2017, this estimate will include an initial forecast of the M&A bonus pool to which the underwriting team are entitled. I have attached a schedule which illustrates the format as to how this bonus pool will be calculated”
The attached schedule was in a similar format to schedules that were sent when contracts of employment were first agreed; thus, they included a figure of 20% for GULR. Mr Brown had approved the schedules before these were sent to Ms Bhoma and Ms O’Reilly. It was suggested that he had also seen and approved the letters to which the spreadsheets were attached. Mr Brown could not recall having seen the letters. There is an email addressed to Mr Brown containing the spreadsheets which Mr Brown recalls having seen and approved. There is, however, no email to Mr Brown attaching the letters themselves. There is no other evidence to suggest that Mr Brown had seen and approved the letters. It was suggested that Mr Brown’s evidence in this regard was confusing given that the pleaded case was that he had expressly denied knowing or approving of the changes to Ms Bhoma’s and Ms O’Reilly’s contracts. It might be said that, having been sent the schedules which were to be attached to the letters, Mr Brown might have been expected to ask to see the letters themselves. However, given the absence of any clear email trail that any draft of a letter was sent to Mr Brown beforehand, I accept his evidence that he cannot now recall whether he did see the letters or not. I reject the suggestion that he is seeking to mislead the Court by concealing that he had seen and approved the letters.
The letter went on to state that:
“Your personal profit share entitlement (PSP) will be expressed as a percentage of the bonus pool. The exact percentage you will receive will be at the discretion of the Remuneration Committee of the Marketform Managing Agency. They will base their judgement upon recommendations made by both the Head of the Class (currently Robert Brown) and the Group CEO (currently Martin Reith). In December 2017 a payment of 70% of your PSP based upon this early estimate of the class profitability will be made.
Once the 2016 YOA is closed, the exact profitability will become known and the 2016 Bony Pool will be calculated. Your PSP percentage share will be the same as applied to the initial payment and if further payments are due they will be made in June 2019 or soon after the closure of the 2016 YOA as is practicable.
As I stated at our meeting we are reviewing all bonus schemes within Marketform. If we were to alter or introduce new schemes for the 2017 YOA onwards these would be at least as beneficial as prior schemes which have been considered for. If we maintain the current scheme future payments to you from the 2017 YOA onwards would be “normalised” (i.e. any payment due paid fully on the closure of any given YOA).
For avoidance of doubt, the terms of the PC bonus payments are as follows:
You will need to be an employee of Marketform to receive the PC bonus payments.
You will not be entitled to receive a PC bonus payment if you no longer work for Marketform or for any of the reasons outlined in Clause 7.4 of your Contract of Employment.”
Both Ms Bhoma and Ms O’Reilly accepted the amendments by signing and returning their letters. Mr Brown was not sent any such letter.
Neon continued to make losses overall following the Claimants’ recruitment. The M&A team, however, was profitable. This was notwithstanding the fact that it failed to hit ambitious revenue targets for each of the years 2015 to 2018. Those revenue targets were reduced year-on-year, and in 2018 the revenue target was £8.25m, of which £3.547 million had been achieved by the time of Mr Brown’s and Ms Bhoma’s departure on 1 May 2018 (which appeared to be on track given that the year-end was December). Neon has sought to highlight these failures to meet targets as being indicative of unrealistic promises made by Mr Brown to deliver business. However, it would appear that during their employment, the Claimants were not criticised for poor performance; indeed, all of them were regularly in receipt of positive appraisals from their line managers. By way of example, Mr Brown’s performance review for 2017, completed by Mr Dougall, states, amongst other things, that:
“Loss notification looks excellent at this stage. You set high standards for risk acceptance and have stuck to your guns as evidenced by declinature rates and quote to bind ratios.… You have a reputation and a brand that’s now well-established and will serve you and Neon well will stop… I recognise all the excellent work undertaken.”
Furthermore, contrary to the tenor of his witness statement on this issue, Mr Dougall confirmed in cross-examination that the Claimants “were performing well against that reduced target.” I find that there was in fact no issue with the performance of any of the Claimants and that the M&A team was performing well, albeit against a target reduced from previously unrealistic levels.
The PC for 2016 was due to be paid in December 2017. However, at a ‘Town Hall’ meeting in November 2017, at which information about the state of Neon’s business was provided to employees in a slide presentation, there was a slide entitled “Housekeeping” by which Neon sought to adjust the 2018 appraisal timetable. The adjusted timetable would mean that communications as to any salary increases and bonuses would be sent in March 2018 and paid in the March payroll, and any salary increases backdated to 1 January 2018. Attendance at that meeting was not compulsory. Mr Brown and Ms O’Reilly were in attendance, but Ms Bhoma was not. They did all receive and read the slides at a later stage. The Defendants rely upon the slides as amounting to written notification of a change to the Claimants’ terms and conditions in accordance with clause 7.1 of the PC rules, which provides that “Amendments may be made from time to time to the scheme in writing and such amendments are entirely at the absolute discretion of MGL”. I do not accept that the information contained in the slides suffices to amount to written notification of a contractual amendment within the meaning of clause 7.1. The slides were presented at a non-compulsory Town Hall meeting and there was no apparent mechanism to ensure that employees who were not in attendance had expressly seen any contractual changes purportedly communicated at the meeting. Moreover, there is nothing in the relevant slide itself to indicate that the change to the payment timetable amounted to a permanent contractual change or anything more than a temporary adjustment to the payment timetable for the 2018 year of account. In that context, Ms Bhoma’s evidence that it did not occur to her that the terms of her contract might be varied by a PowerPoint slide of a meeting she did not attend, is wholly unsurprising.
Proposed New Contracts
Employees were given notification of the rebranding of Marketform to Neon in June 2016. At the same time, they were informed that new employment contracts along with an updated staff handbook would be issued in due course. However, it was not until early 2018 that Neon began the process of issuing the new contracts. By an email dated 27 February 2018, HR informed employees that new contracts of employment would be issued because the current ones “do not represent our new culture and outlook as Neon”. Further information was provided to employees about these changes in the form of questions and answers. In answer to a question, “Have there been any changes to my existing terms?”, the answer was:
“Yes, although we hope that you agree that these changes are beneficial to you. The main changes would like to draw your attention to are as follows:
Pension: we have removed the age-related pension contribution scheme and replaced it with a single rate scheme…”
Other changes highlighted were in relation to holiday carry over, special leave, and maternity leave.
In answer to a question, “Have you introduced any new terms or policies?”, the answer was:
“Yes. In particular, we would like to highlight:
: all employees will be subject to Post Termination Restrictions in respect of non-solicitation of Restricted Employees and in respect of team moves.”
The email concluded by stating that the employee handbook had been attached for reference “along with the standard Employment Agreement”. Employees were finally informed that they would receive, “a copy of your own updated Employment Agreement and a Handbook acknowledgement form, for signature, when you have your year-end compensation discussion with your manager…”
Given that this email notification merely sought to highlight certain changes, it was reasonable for the Claimants to await receipt of their actual amended contracts to consider the changes affecting them.
On 7 March 2018, Mr Brown was called into a meeting with Mr Martin. Mr Brown was told that all employees would shortly receive letters from HR containing the new employment contracts and handbooks. Mr Martin said that the bonus pool would be approximately 70% of the previous year’s amount. He went on to explain that the pay rises and bonuses that had been awarded would only be given out if the new employment contracts were accepted and signed. Mr Martin also informed Mr Brown that the PC pool for the Claimants had been calculated at £150,000 and the company was being generous by paying out considerably more. Mr Brown explained to Mr Martin that the PC bonus pool amount sounded incorrect and that he had expected it to be closer to £500,000 because there had been no losses in 2016, that being the relevant year for the PC payment in question. Mr Martin said that an assumed loss ratio figure had been used for the calculation. Mr Brown explained that the agreement at the time of joining Neon was that a figure based on actual losses should be used and that the PC was the reason that the team joined Marketform in the first place. However, Mr Martin indicated that he was not prepared to discuss the PC bonus calculation any further stating that “it is what it is”. When Mr Brown indicated that his team would not be happy with the PC scheme that they had agreed being replaced with a discretionary bonus and being forced to accept new contracts, Mr Martin was not interested and said, “it was up to people whether they choose to work here or not”. These notes of what Mr Martin said emerge from a note prepared by Mr Brown immediately after the meeting. It has not been suggested to Mr Brown that the note is inaccurate, and I accept it as a correct (though clearly not verbatim) record of their discussion. Mr Brown continued to press upon Mr Martin that the proposed changes would mean that the M&A team would lose people, but Mr Martin was not prepared to change his view.
Mr Brown left that meeting feeling very unhappy about the changes proposed and the way in which they were being put forward which, as he saw, was a “like it or lump it” approach without discussion, debate or negotiation. In my judgment, having considered the note of Mr Martin’s comments at that meeting, which I accept as being accurate, Mr Brown’s description of Mr Martin as taking a “like it or lump it” approach was apt.
On 8 March 2018, Mr Brown informed Ms O’Reilly that Neon were proposing to replace the PC entitlement with a discretionary bonus. Ms O’Reilly was shocked to hear this as the PC was the main incentive for joining. She met with Mr Martin later that day. Mr Martin told Ms O’Reilly that the M&A PC was being removed and being replaced with a discretionary bonus scheme. Ms O’Reilly said that she was very disappointed with this and queried how the discretionary bonus would work. Mr Martin informed her that part of the total Neon bonus pool would be based on the financial performance of Neon as a whole. Ms O’Reilly considered that this would clearly be detrimental to her, particularly as Neon as a whole was still making a loss. She pointed out that in theory her bonus could be zero under such a scheme and Mr Martin did not disagree. When she tried to explain how disappointed she was, Mr Martin did not engage with her and presented the new terms as a fait accompli. In an email sent to Mr Martin the following day, Ms O’Reilly asked Mr Martin to “provide me with details of the profit commission calculation for the 2016 year of account so as I can make an informed decision as to what is in my best interests going forwards (sic)”. No such information was provided.
There were several communications between the Claimants on 8 and 9 March 2018 during which they expressed their disappointment at the changes which they understood were going to be introduced. Ms Bhoma wrote to Mr Brown at 12:41 on 9 March 2018, saying as follows:
“I’ve had a very upset Astrid on the phone as I understand there is to be a fundamental change to our contractual bonus pool calculation. I have no detail on this and of course still do not know my bonus for the 2016 year of account. Astrid is very unsettled by this as am I. Astrid believes we are to receive a letter on the topic but I have not yet received one. As you know, that bonus structure was absolutely critical to my decision to join the team and is also the basis on which I have been able to recruit Andrew and Suhail.
Can you please urge management to let us all know what they propose as this is an issue which affects every single person in the M & A team? If letters are going out, I assume they are to every person in the team. So far, it looks as though only Astrid and I have been invited to have a discussion with Ian Martin…”
At 12:52 on 9 March 2018, Mr Brown received an email from Ms Andrew stating that contracts needed to be signed by the following Tuesday.
Letters (which were dated 7 March) enclosing the new Employment Agreement, Employment Handbook and acknowledgement form were distributed to the M&A team later on 9 March 2018. Ms Bhoma was working from home that day and received hers the following Monday.
The letter addressed to Mr Brown stated as follows:
On behalf of the board, I would like to thank you for your contribution to the company during 2017.
Discretionary Bonus
Once again, American Financial Group have, very generously, agreed to fund a bonus pool in order to recognise individual performance, effort and achievement during what has been a period of continuing change and growth for the Company. The bonus also reflects a desire to incentivise you to stay and help us to achieve our ambitions for the Company going forward. I am therefore pleased to confirm that, subject to the requirements outlined below and the discretionary bonus rules set out in paragraphs 5.1 and 5.2 of the revised Employee Handbook, you have been awarded a discretionary bonus for the calendar year 2017 of £75,000 (the “2017 Bonus”).
If you give notice to terminate your employment with the company on or before 23 March 2019, 100% of the net amount of the 2017 Bonus received by you will become immediately due and repayable to the company.
Basic Salary
Effective 1 January 2018, and subject to the requirements outlined below, your annual Basic Salary (the “Basic Salary”) will increase to £257,500. Your March 2018 payslip will record not only this new Basic Salary payment but also top up payments for the past two months to reflect that the increase was effective from 1 January 2018.
Changes to terms and conditions
As you are already aware, following our E-mail to all staff of 27 February 2018, we are using this period of change and growth for the Company as an opportunity to refresh our Employment Agreements and Employee Handbook so that they better reflect the needs of the business and are brought up to date to reflect recent regulatory changes. Enclosed with this letter is your revised Employment Agreement, our new Employee Handbook and a Handbook acknowledgement form. Together, your Employment Agreement and Part 2 of the Employee Handbook form your contractual terms and conditions with the Company. Please read and review your terms and conditions carefully. This year’s increase to your Basic Salary and the 2017 Bonus payment, outlined above, are conditional on you entering into these new terms. For the avoidance of doubt, you explicitly agree that the rules of any Profit Commission Scheme of which you were once a member, no longer apply and instead subject to the Company’s discretionary annual bonus scheme. If you do not agree to the new terms then your existing terms will remain in place and you will not be eligible to receive the increase to your Basic Salary or your 2017 Bonus…
If you have any questions about the content of this letter, please do not hesitate to contact a member of the HR team.”
The attached schedule setting out the PC calculation indicated that a figure of 48% had been used for GULR. Upon reviewing the contracts, the Claimants considered that, as well as the removal of the PC entitlement which they believed they had, the following paragraphs of the new contract of employment were detrimental to them:
i) By paragraph 5.5, pension contributions were to be capped as a percentage of notional base salaries of £80,000 for Mr Brown and £100,000 for Ms Bhoma and Ms O’Reilly, which were lower than their actual respective base salaries;
ii) By paragraph 6.2, Ms Bhoma’s holiday entitlement of 25 working days plus statutory holidays a year was reduced to 20 working days plus 6.5;
iii) Extensive new post-restriction terminations were introduced; and
iv) Discretionary bonuses were subject to a clawback if notice was given within certain stipulated periods.
The Defendants accept that extensive new PTRs were introduced. Ms Andrew accepted in cross examination that these would be detrimental to the Claimants and favourable to Neon. However, Neon disputes that the other changes as to pension contributions and holiday pay were detrimental. As to the bonus clawback, it is said that this should not be considered as it is not part of the pleaded claim. I shall return below to these proposed changes, and in particular to the PC entitlement.
Response to proposed changes
Mr Brown considered that he had little choice but to resign from Neon even though he had nothing to go to because the proposed terms were materially less attractive than those which he had. He considered that he had been treated extremely badly and did not see how he could remain at Neon. He sought legal advice. In the early hours of 12 March 2018, Mr Brown sent an email to Mr Martin setting out his PC calculation using actual losses based on notified claims to date and not assumed future losses. As there were no claims, he used a figure of 0%, in that email he said amongst other things:
“Ian,
I know you that you didn’t want to go through the PC calculation when we met briefly last week but it is incorrect for 2016 YOA. The calculation includes £3,940,960 of losses (which is an assumption) but the actual losses are zero. Taking the actual losses of zero, creates a total profit for the M&A division of £5,395,523; therefore the 9.7% PC of £523,365 (not the hundred and £141,190 in your spreadsheet). The PC is calculated from actual losses incurred, not assumed future losses, and that is why the calculation for 2016 YOA should have been done and paid at the end of December 2017 (not sooner) and why there is a deficit clause built into the rules to provide for later deterioration (if there is any) of results after the PC is calculated and paid.
I received my letter and new contract on Friday afternoon. It appears from the letter that I will only receive my bonus and pay rise if I accept and my new contract by Tuesday. The 2016 YOA bonuses should have been calculated and paid in December 2017. Now I am being advised that I (and others in the team) will not receive this payment to which we were entitled and instead, receive a smalerl payment with more onerous restrictions.
The reason that I and others joined the company was because of the PC and now I am being told that I have to forego this and accept less attractive benefits. The letter which I received on Friday states that, if I don’t accept the new contract I will not receive a pay rise. Is it correct that I will not receive the current pay rise (any presumably any future pay rises) unless I sign the new contract.
Please could you clarify what the future bonuses will look like because it appears to me that I would be waving predictable PC bonuses, ring fenced from the wider Neon result, for completely discretionary bonuses of an unknown amount?
Up until this point, I had believed that I was a valued part of Neon and have been working very hard to work towards our ambitious goals. Now I feel that the imposition of these new employment terms and the way in which it is being done is unreasonable. It comes across quite clearly that, if I do not give up my 2016 PC bonus and beyond, for much more modest bonuses and small pay rise, I will not receive future pay rises and frankly wouldn’t have a future at Neon. This puts me in an awful position personally as I have dependents and financial commitments. As I mentioned when we spoke last week I’m concerned that the new contracts, removing the PC bonus, may lead to valuable team members leaving at a point where we have a good reputation and strong momentum into 2018…
Mr Martin responded by stating that Mr Brown’s analysis was one-sided, and he asked for any information that countered his understanding of the position. He stated that no one would get a 2017 discretionary bonus or pay rise until they signed and that that was a condition for all employees including Mr Martin himself. Mr Martin ended the email by saying, “Understand how you feel. However, I believe Neon culture is what will define us – the fact is we all need to have a shared vision, motivation and rewards.”
Mr Martin forwarded his exchange with Mr Brown to Mr Reith, the group chief executive, saying “FYI – I am hardening my line the below has made me cross.… You either believe in being part of something or not.” Mr Reith responded by saying, “I agree… I wonder if we are coming to the end of the line here, seriously!” Another member of the executive team, Mr Matthew Washington, commented on Mr Brown’s email as follows:
“This is a terrifying level of self-centred, short-term self-interest akin to the sorts of behaviour that underpinned the MBS/CDO or market in 2007. One book with a circa 7-year tale, why should a PC be based on incurred after 2 years? It’s simply insane.
Payroll cut off is today, so anyone who has failed to return the contract does not receive their offered rise/bonus. We have to hold the line on this hard, or else no-one will believe any deadline we set, ever again.
I can only say that I’m disappointed at Rob; here is a man who has brought us 3 x employee issues and failed to meet his business plan expectations for the two underwriting years for which he has been at Neon. Coupled now with a level of toxic short-termism, I would say that does not fit with any culture that I would ever want to be a part of.
Very sad.”
Upon receipt of her contract, Ms Bhoma expressed her immediate concerns to Mr Brown by email on 12 March saying:
“(1) the bonus number cannot be right unless I have been given a disproportionately low share which given my exceptional performance for 2016, I believe cannot be the case. I know Ian Martin refused to show you the bonus pool calculation last week but can this be discussed see if anything has moved on? (2) given I have only just received it, I don’t see how I can properly read and consider the proposed contract by tomorrow. I need to be able to understand the implications and need to read line by line any proposed changes of term for me. I feel as though I have a gun to my head!”
Later that day, Mr Martin met with Mr Dougall. By all accounts this was a difficult meeting. It is fair to say that Mr Brown did not help his position by engaging in behaviour which understandably appeared to Mr Dougall to be somewhat odd. This involved repeatedly looking at Mr Dougall with “blank, silent extended looks” and staring at Mr Dougall “alarmingly”. Mr Dougall, based on his understanding of the PC agreement between Neon and the Claimants, had gone into that meeting with the view that Mr Brown had mis-communicated bonus expectations to the rest of the team. He sought to explain to Mr Brown his understanding of GULR and sought to persuade him to “buy into Neon”. Mr Dougall was aware that without Mr Brown’s cooperation he would not be able to convince the rest of the M&A team. Mr Dougall was sympathetic to the fact that the letters of 7 March 2018 setting out salary increases and discretionary bonuses, subject to agreeing new terms, had been “handed out bluntly by Mr Martin”. However, he considered that timings were very tight for Neon and it was necessary for people to make their mind up on the new terms within a very short timeframe. Mr Brown was told that he had a deadline of 13 March 2018 to make up his mind and if he was not on board by then, “We will call it a day”, which Mr Brown, not unreasonably, understood to mean that his employment would just come to an end.
Mr Brown updated Ms Bhoma as to his communications with Mr Dougall and Mr Martin. She felt she was being pressured into giving up her PC and that Neon’s PC calculation was based on a wholly unfavourable and unrealistic loss ratio. She felt undervalued and betrayed.
Ms O’Reilly had a meeting with Mr Dougall on 13 March 2018. Ms O’Reilly prepared a detailed note of that meeting immediately afterwards. It was not suggested to her that the meeting note was inaccurate, and I accept it as a correct record of the key points made by Mr Dougall. Mr Dougall acknowledged that Mr O’Reilly was not happy and told her to “get it all off your chest now”. Ms O’Reilly said she was unhappy with the changes to the PC and the discretionary bonus. Mr Dougall said that the 48% figure for GULR was correct and that “no insurance company would base PC on actuals one year after on long tail business as this means they could be stung with a big claim later on”. Mr Dougall further stated that the 8 February 2016 letter was clear that the PC calculation is an estimate based on ultimate financial performance and that the Claimants “had clearly been miscommunication (sic) to by Simon Lotter”. Mr Dougall went on to describe Mr Lotter as a “fuckwhit” and said “no one can promise a PC on actuals after the first year. No regulator or Lloyds could approve that”. The meeting concluded by Mr Dougall saying that Ms O’Reilly had two choices, “1. Accept new contract and trust that Neon would reward for good performance and low loss ratios in the future; and 2) get into a contractual dispute but doesn’t think I have a good argument.”
Ms Bhoma also had a meeting with Mr Dougall. This was on 14 March 2018. Once again, a note of this meeting was prepared by Ms Bhoma very shortly afterwards. The note was not challenged and I accept it as being an accurate record. She was also told to get everything off her chest. As to the PC calculations Mr Dougall rejected any suggestion that the PC should be calculated on the basis of actual losses. He further stated that, “Simon Lotter is a “fuckwit” and the business lost £50m last year so can’t pay it”. (Emphasis added) The “it” there was clearly a reference, in the context of the note, to PC calculated on an actual loss basis.
The Claimants sought advice from the same solicitors. They decided to resign and they all tendered their resignations on the same day, 16 March 2018. Their resignations letters were not identical but were in similar terms. Broadly speaking, each of them contended that their position had become untenable due to the proposed detrimental changes to their Contracts of Employment, and the removal of the PC, which were being forced upon them. Although the resignation notices referred to fundamental and repudiatory breaches of contract entitling them to resign without notice, each of the Claimants resigned on notice. That would mean, in Mr Brown’s case that his employment would come to an end 12 months later on 15 March 2019. The notice periods for Ms Bhoma and Ms O’Reilly were shorter and due to expire on 15 September 2018. None of them had any other jobs to go to.
The timing of these resignations was seen by Neon as suspicious and it assumed that this was a coordinated act that had been in the planning for some time. Mr Dougall, in an executive summary of the situation sent to fellow managers on 17 March 2018, said, “it’s reasonable to assume this is coordinated with some external guidance and has been initiated and planned in advance of last week for them to move so quickly.”
Events after resignation
At 14:43 on 19 March 2018, Mr Reith sent an email announcing the resignations internally. He said, “Neon remains committed to the M&A class and the remaining team. We wish to continue to build out this class and Andrew, Darren and I will support the team through this period.” The reference to Andrew, Darren and Mr Reith supporting the remaining team is of note because it suggests that the Claimants would no longer take the lead in supporting the team.
On the same day Mr Brown and Ms Bhoma attended a meeting with Ms Andrew and Mr Martin. Mr Brown was instructed not to discuss his resignation with anyone as Neon wanted to “control the messaging” and he was reminded of his ongoing obligations to his employer.
Mr Brown had a pre-arranged dinner meeting with Mr Louden for Monday 19 March 2018. Mr Louden and Mr Brown had known each other for a number of years and, as Mr Louden was the Deputy Chief Underwriting Officer of Axis, the second lead insurer behind Neon in the consortium, he and Mr Brown would meet regularly in a business capacity. Following his resignation on 16 March 2018, Mr Brown had tried to cancel the dinner through the Outlook system. When Mr Louden received notification of the cancellation he contacted Mr Brown to ask what was going on. Mr Brown called Mr Louden and asked if Neon had been in touch. He also told Mr Louden that things were “tricky at the moment” and asked if the dinner could be rearranged. Mr Louden immediately assumed from Mr Brown’s tone and the awkwardness of the conversation that Mr Brown had resigned. This came as something of a surprise to Mr Louden as he thought the team at Neon seemed happy and the consortium itself had been performing well. As Mr Louden was concerned about the future of the consortium he felt he needed to find out more about the situation. His employer had committed substantial capital to the project and he was concerned that there was a risk that things might not be going to plan. Mr Louden insisted that the dinner should go ahead as originally planned.
At the dinner, Mr Louden asked Mr Brown directly what was going on and whether he had resigned. Mr Brown confirmed that he had done so and asked once again whether Neon had been in touch. Mr Louden confirmed that Neon had not been in touch. Mr Louden expressed disappointment that no one from Neon had told him about the resignation. After the dinner, Mr Louden considered that he needed to find out directly from Neon what its position was in relation to the resignations. By 21 March 2018, frustrated that he had still not heard anything from Neon, he contacted Mr Dougall and said that there was “Lots of noise in the market concerning Rob and team and I haven’t been able to catch up with him. I thought I would come straight to you in case there is any truth in it and discuss the implications.” Mr Louden acknowledges that it was wrong of him to have implied to Mr Dougall that he did not already know about Mr Brown’s resignation. Mr Dougall did call Mr Louden back and explained the situation. At 15:09 that day a bulletin from “The Insurance Insider” publication announced the departures of the Claimants publicly.
One of the effects of the resignation being announced was that new business was likely to dry up as no broker could be expected to place their clients’ risks in a market where the lead underwriter and the team may not be there to execute the deal. As stated by Mr Higgs, whose evidence was unchallenged, “In short, business drops off immediately after the resignation of the key figure within a team is announced.” There were further resignations from the M&A team in subsequent weeks such that by about 23 April 2018, only one of the team had not given notice of resignation: Ms Vanessa Young resigned for unrelated reasons, Ms Nash had already resigned prior to the Claimants’ resignations, and Mr Thornton resigned on 23 April 2018. The inevitable consequence of the Claimants’ resignations, I find, was that the workflow quickly dried up. Mr Dougall referred to the work as having “fallen off a cliff as you would expect until you re-engage” at a meeting with consortium members on 17 April 2018.
On 21 March 2018, Mr Dougall told Ms O’Reilly to clear her desk, work from home and report to Ms Young, who was a less experienced underwriter than Ms O’Reilly.
The Claimants’ Solicitors sent a letter before action on 26 March 2018. Various breaches of contract were alleged including that their declared pay rises and discretionary bonuses had not been paid, and that the PC had been incorrectly calculated. Ms Andrew indicated that she would respond to the letter before action by 16 April 2018. By this time, however Ms Andrew had undertaken a search of Mr Brown’s and Ms Bhoma’s emails. Neon’s suspicions had been raised following the joint resignation and it was thought that a search of their emails might reveal evidence of wrongdoing. The search apparently resulted in the identification of two emails containing confidential information which had been sent by Mr Brown and Ms Bhoma to their private email addresses. The sending of these emails led Neon to write to the Claimants solicitors on 20 April 2018 in the following terms:
“We are concerned to learn that Rob Brown and Dawn Bhoma have both breached their contractual obligations to Neon Management Services Ltd (“Neon”), and breached their common-law duties of confidentiality. We refer to their respective contracts of employment which set out their obligations and which Neon is entitled to enforce… It has come to our attention that Rob and Dawn have both forwarded confidential information from their Neon email address to their private email addresses. There is no legitimate business reason for them to forward any such confidential information. We are undertaking further investigations into your clients’ conduct and will provide an update next week…”
Various undertakings were sought including for the delivery up of property and confidential information and a written schedule of all clients or potential clients to whom they had made approaches or with whom they have had dealings. The letter concluded by saying, “However, as we are a regulated business, it was our duty to inform the regulator of this breach, which we have duly done. In the meantime, all our rights are expressly reserved.”
The regulator in this case was Lloyd’s of London. The consequences of such a report for the Claimants’ professional standing are potentially serious. Neon had not provided the Claimants with any opportunity to answer any allegations of misconduct prior to this report being made to Lloyds.
The Claimants’ solicitors responded by email dated 23 April 2018. They stated that the allegations were “baseless” and that they lacked particularity. It was stated that in so far as personal email addresses had been used this was in order exclusively to further Neon’s business interests and that the information had not been shared with any Third Parties. It was asserted that it was accepted practice at Neon for staff to use their personal IT equipment.
On 24 April 2018 Ms Andrew denied that the Claimants had valid business reasons for forwarding emails and attachments to their private email addresses. However, she did say:
“We accept that employees do, on occasion and in limited situations, use their private email accounts. However this is the exception rather than the rule. Your clients are attempting to justify their behaviour by hiding behind the notion that employees need to rely on their personal email accounts to perform their role. This is simply untrue.”
Meanwhile, on 17 April 2018, Mr Dougall held a meeting with Mr Louden in order to reassure him that even though the M&A work was slowing down significantly following the staff departures, it was still important to follow through on deals that were in the pipeline. In short, the aim was to persuade Mr Louden that it was “business as usual”. Mr Dougall sought to represent at the meeting that the remaining members of the team had been told to continue to refer risks to Mr Brown and Ms Bhoma notwithstanding their resignations. This was not in fact correct. Neon had made it clear to Mr Thornton and others that risks were to be referred to Mr Boorman and Mr Dougall. Mr Thornton gave unchallenged evidence to that effect. Furthermore, as is apparent from a note of the meeting on 17 April 2018, when Mr Dougall sought to suggest that Mr Brown and Ms Bhoma retained authority for new risks, Mr Thornton said as follows:
“AT: and just to go back to what Andrew [Dougall] said about the authority thing it’s because we were told at the start we were told to go to you [CB – Mr Boorman] and Andrew [Dougall] but it’s now, is it going to be Rob and Dawn as well now?”
Mr Thornton’s apparent uncertainty as to the managers he was reporting to is understandable given the inconsistency between what Mr Dougall had previously said to him and what he was now saying to Mr Louden at this meeting. In fact, this inconsistency on the part of Mr Dougall was one of the reasons given by Mr Thornton for his resignation a few days later. I find therefore that the remaining team members had been instructed to direct work to Mr Boorman and Mr Dougall. Furthermore, I find that this diversion of work in conjunction with the downturn in new work was the cause of the Claimants’ relative inactivity following their resignations. The work was simply no longer there to be done and Mr Brown and Ms Bhoma had not sought to obstruct any restructuring that Neon tried to implement in order to keep the business afloat.
Mr Brown said very little at the meeting on 17 April 2018 as is apparent from the note of the meeting. It was suggested to Mr Louden he and Mr Brown had agreed that Brown would say very little and they would “go through the motions” at the meeting (as Mr Louden had stated in a subsequent email to Mr Brown). This was denied by Mr Louden who explained that the reference to “going through the motions” was to how “painful and awkward” the meeting was given that Neon was trying to persuade Mr Louden that things could continue to work when in fact further team members, including Miss Vanessa Young, had already resigned; a fact which was not disclosed to Mr Louden until Miss Young told him herself at the end of the meeting. I am satisfied that there was no plan or intention on the part of Mr Brown and/or Mr Louden to deceive Neon at this meeting; on the contrary seems to me that Mr Dougall was doing all that he could to portray the business as being sustainable when it must have been clear to him by that stage that it was not.
Mr Dougall provided an update to fellow managers on 18 April 2018. He described the situation in the M&A team as “a viper’s nest” and referred to the disruption created by Claimants with “Rob planting traps to dismantle the consortium.” What these “traps” were was not at all clear. Whilst the situation in M&A was undoubtedly difficult, it does not appear to me that Mr Brown was doing anything deliberately to undermine the consortium. Mr Dougall continues his email by saying, “God knows where this is heading legally with him [Mr Brown] but theres [sic] no doubt they are simply trying to get out with money and being free to take staff and get operating.” Mr Darren Lednor, Chief Underwriting Officer, responded to Mr Dougall and said:
“Agree it seems we are losing control of the situation without Vanessa and Andrew. Agree we stop new new, tell Lloyds. Tell consortium but we don’t let him go until the new people are in. We keep him in the office. We change his role to project work. Eek (sic) out his contractual terms. Unless of course we lose the legal action.”
It is clear from these exchanges that by this stage Neon’s managers had convinced themselves that the Claimants were seeking sums to which they were not entitled and were engaged in acts of wrongdoing with a view to damaging Neon’s business. I shall return below to whether or not there was any foundation for that belief. However, the lack of trust and confidence which Neon had in the Claimants, and in Ms Bhoma and Mr Brown in particular, was made clear by a further letter dated 26 April 2018 sent after a meeting on the same day at which Mr Brown and Ms Bhoma were put on gardening leave. That letter said, amongst other things:
“Since your resignation notice on 16 March 2018 we have found your behaviour to be increasingly disruptive and unprofessional. You have been absent from the office without explanation several occasions and have not been performing your duties under your employment contract dated 6 March 2015…”
Various findings of breaches of contract are then set out and Ms Andrew continues by saying, “We have lost trust and confidence in you and been forced to take the decision to suspend the M&A class for new business.”
Mr Brown and Ms Bhoma resigned with immediate effect on 1 May 2018 on the basis that Neon’s conduct amounted to a fundamental breach of the contract of employment.
The Issues
The parties have agreed a detailed list of issues. I shall deal with each issue in turn in light of the findings of fact made above and having regard to the further findings and inferences to which I refer below. The numerous issues are grouped under the following main headings:
i) The Terms implied in the Claimants’ Employment Contracts
ii) The PC Terms
iii) Alleged failure to pay discretionary bonuses and pay rises
iv) Alleged failure to pay Unpaid PC
v) Alleged repudiation by the First Defendant
vi) The Post Termination Restraints
vii) The Defendants’ Counterclaim
Terms implied in the Claimants’ Employment Contracts
Was the First Defendant obliged to exercise any contractual discretions: (i) rationally and in good faith, for the purpose for which the discretion was furnished, both as to its decision-making process and as to the outcome of that discretion (as the Claimants contend) or (ii) not irrationally (as the Defendants contend)?
I struggle to see any difference in substance between the two options above. A discretion which is exercised for an irrelevant purpose or for a purpose for which the discretion was not intended would probably not be a rational exercise of the discretion. Similarly, it would be arguable that a discretion that was exercised in bad faith was not a rational exercise of the discretion. As such the apparent qualifications in the first option add little, in my judgment, to the established approach which is that a contractual discretion to award bonuses must not be exercised irrationally: see Clark v. Nomura International plc [2000] IRLR 766 (QB) per Burton J. at 40 as subsequently cited in Horkulak v. Cantor Fitzgerald [2005] ICR 402 (CA) per Potter LJ at 40 and Keen v. Commerzbank AG [2007] IRLR 132 (CA) per Mummery LJ at 59
If the First Defendant suspected misconduct by the Claimants:
Was it obliged to conduct an investigation?
Whether or not there is an obligation to conduct an investigation would depend on the circumstances. The Defendants’ position is that there was no reasonable need to investigate here because Mr Brown and Ms Bhoma ‘admitted’ that confidential information was sent to their personal email addresses and that amounted to a breach of the relevant IT policy. However, the chronology is significant; if Neon reached firm conclusions as to misconduct prior to any such “admission”, then it might be said that Neon had acted prematurely, particularly if no opportunity had been provided the individuals to explain the impugned conduct. Furthermore, it is also relevant to note that the breaches first identified by Ms Andrew in her email of 20 April 2018 were not stated to be breaches of the IT policy, but were said to be breaches of confidence in that they forwarded confidential information to their private email addresses having no legitimate business reason to do so. An allegation comprising those elements, in order to be made good, would usually require the employer, acting in a manner not likely to undermine trust and confidence, to provide the individual concerned with an opportunity to explain whether there was a legitimate business reason for sending information.
The real question in this case is whether the way in which Neon approached this matter amounted or contributed to a breach of the implied duty of trust and confidence. That question is considered below under the heading, “Alleged repudiation by the defendant”.
In what circumstances was the Second Defendant obliged to report a suspected “regulatory breach” to Lloyd’s?
Neon relies here upon the evidence of its General Counsel, Mr McKay, who suggests that it was under a regulatory obligation to report “misconduct” as defined in the applicable Lloyd’s Bylaws. Part C of those Bylaws provide that any person subject to the enforcement jurisdiction of the Society, who believes or has reason to believe that any other such person “has committed or intends to commit misconduct within the meaning of this bylaw”, shall notify the Council of the belief in writing soon as practicable and provide any documents or other material they believe to be relevant. There is no dispute that Mr Brown and Ms Bhoma are persons subject to the jurisdiction of the society. The question is whether there were grounds for believing that they had committed an act of misconduct. “Misconduct” for these purposes is defined in Part A of the Bylaws. The relevant limbs of the definition provide that “misconduct” means:
i) engaging in or being associated with or conspiring with another person to engage in discreditable conduct, whether or not connected with the business of insurance; or
ii) conduct that is detrimental to the interests of the Society, members, underwriting agents or Lloyd’s policyholders or others doing business at Lloyds;
The question therefore was whether Mr Brown and Ms Bhoma were engaging in discreditable conduct or conduct that was detrimental to the interests of Neon in sending emails to their private email addresses. Not every breach of the strict terms of the IT policy, which is not contractual, would amount to conduct that was “discreditable” or detrimental to the interests of Neon conduct. Neon accepts that employees do on occasion use their private email accounts. Mr McKay gave evidence that on at least five occasions between December 2016 and February 2018 he sent company information, which was in most cases sensitive and confidential, to his personal email account and describes other occasions where such information was sent to or from his personal email address (including on one occasion to his young son’s tablet). Mr McKay sought to suggest that he had general clearance from the Head of IT to send such material, but it seems highly doubtful that even the most relaxed approach to the IT policy would authorise the use of a child’s tablet. There is no suggestion that Mr McKay was reported to Lloyd’s for such conduct. No doubt this was because it was considered that he was acting in this way for legitimate business purposes and/or because there was no other option but to do so in order to gain access to or print documents. Mr Brown and Ms Bhoma say that they too had a legitimate business purpose for sending the documents in question and that they had to do so because of technical limitations. There is no reason to believe that the Head of IT would have had any objection to Mr Brown and Ms Bhoma (who were both senior employees) acting in a similar way to Mr McKay as regards personal devices and addresses. However, it would appear that Neon reached firm conclusions as to their conduct and reported them to Lloyd’s before conducting any sort of investigation as to their reasons for so doing. I shall return below to the question of whether that failure to investigate and the rush to report to Lloyds amounted or contributed to a breach of the duty of trust and confidence.
But in answer to the question posed by this issue, in my judgment the obligation to disclose misconduct to Lloyd’s could only arise where, following a reasonable investigation, there was reason to believe that Mr Brown and Ms Bhoma had committed or were intending to commit an act of misconduct as defined. It was certainly not enough simply to rely upon the fact that private email addresses may have been used without enquiring as to the circumstances in which that was done. That was all the more so where, as Neon well knew, reporting the matter to Lloyd’s could have serious professional consequences for Mr Brown and Ms Bhoma.
The PC Terms
Was the original PC to be calculated on actual losses or estimated losses (such as GULR)?
The Claimants contend that there was an express agreement at the time of their recruitment that their PC would be calculated on the basis of actual and not estimated losses. The Defendants say that any agreement as to PC must necessarily have been based on estimated losses and that this is confirmed by the inclusion of GULR in the contemporaneous documentation.
It is important to note that the two types of loss are not mutually exclusive. That is because even a reference to actual losses will involve an element of estimation since the true actual losses would not be known until after the end of the policy period, which as we have seen, extends to seven years. The reference to “actual losses” on the Claimants’ case, therefore, is more accurately described as an estimate of loss based on actual notified claims to date.
Although the Defendants contend that the Claimants have sought to change their case in this respect, with Mr Solomon going so far as to suggest that Mr Brown’s admission that Mr Lotter had in fact used the phrase “best estimate” during their negotiations was devastating to the Claimant’s case, it is my judgment that the Claimants have in fact been consistent in their case as to “actual losses” and that it meant an estimate of loss based on actual notified claims to date. I have already referred above to the unchallenged evidence of Mr Brown in his witness statement where he said that Mr Lotter had told him that “best estimate” was the “best estimate of the likely outcome of notified claims”. Mr Brown’s reference to “best estimate” in cross-examination was therefore neither a new point nor one that was inconsistent with his case that PC was to be calculated on the basis of actual losses.
Similarly, Ms Bhoma said as follows during her cross examination:
Q. How can an actual loss, incurred as at a date, be an estimate?
A. Because if you were to look at — you would look at notifications received, for example, in relation to that year. So you could say, as an example: we have received ten notifications of claims for the 2016-year, by the end of, for instance, December 2017; and you therefore make an estimate of which of those notifications will lead to actual loss.
Q. So on your understanding, it was always going to be an estimate, not actual losses, but would only involve notified claims; is that right?
A. Yes, so it would be actual losses, as identified at the date of running the calculation.
Q. Why not future potential claims, not yet notified?
A. Because that was not what was agreed. So to get an accurate calculation, I accept you would only know the final result at the end of year 7; but that was not what we agreed.
The final question in that extract from the cross-examination of Ms Bhoma refers to future potential claims not yet notified. This would be referred to as claims which are “incurred but not reported” or “IBNR”. There was a reference to an internal email sent by Mr Lotter to other managers at Marketform at the time that negotiations were being conducted with the Claimants in which he stated that “IBNR remains within our control”. Ms Bhoma was asked about this email even though she was not a party to it at the time. She initially accepted that IBNR was discussed with Mr Lotter but later sought to clarify that whilst that term was not used, they had discussed “estimates or actuals” and that they “did not agree that he could use any form of estimate, whether it be GULR or IBNR”. In my judgment, Ms Bhoma was not seeking to change her evidence here and nothing in that extract undermines her case as to what was agreed. In any case, whatever Mr Lotter might have said or not said to his colleagues is of limited assistance in determining what was agreed between the Claimants and Mr Lotter and Mr Gregory (who clearly had authority on behalf of Neon/Marketform to negotiate and agree terms).
As to what was agreed, the contemporaneous communications from Mr Gregory and Mr Lotter to the Claimants are of more significance. These have been set out above, but they bear repeating here:
i) Mr Gregory emailed Mr Brown on 30 January 2015:
“I’ve spoken with Simon [Lotter] re your 3 questions. To reconfirm the loss ratio figure of 20% in the calc is an example number The calc will be based on actual at the close of say 2015. The PC payment would then be paid after the close of the year and therefore for 2015 in early 2018”
ii) Mr Lotter emailed Mrs Bhoma on 5 March 2015:
“The PC calculation is based on actual numbers”
Mr Solomon submits that the reference to “close” in the phrase “actual at the close of say 2015” in the first of these emails is, when read with the rest of the passage, a reference to the end of the three-year period and that “actual” would be calculated at that point. I reject that submission, which seems to me to be an attempt get around the obvious meaning of the phrase, “actual at the close of say 2015” said immediately after saying that the GULR figure of 20% was just an “example number”. That phrase is perfectly consistent with the way in which the Claimants have put their case, namely that the loss ratio would be based on actual notified claims as at the end of the year of account. That loss ratio would still involve an estimate, but it would be grounded in the actual notified claims as at that point. Although the Defendants contend that such an approach is commercially unacceptable there is, in my judgment, some rationale for it in this sector in that most claims are usually made in the first two years of the policy, as explained by Ms O’Reilly:
Q. And you agreed that that’s the right way to determine the financial performance of the M&A class, on an estimated basis?
A. On an estimate which would be based on actuals, yes.
Q. Where does it say that?
A. It doesn’t say that, but that was my understanding from what I had been told by both Robert Brown and Simon Lotter, and it also speaks about an initial forecast; so you can’t make your forecast on numbers which you pluck out of the air. The forecast has to be based on notifications. And given also that the way we calculate the profit commission is, for most policies, over a year after the first date of inception, the majority of claims arise in the first two years. So you would have a very clear picture as to how the outlook of the book would go. And secondly, because there’s, (a), a 30 per cent hold-back, so if a claim did arise after that, then that would be taken into account in the 30 per cent tranche. And, (b), our profit commission was subject to a two year deficit clause. So if there were a loss, then it could be clawed back at a later date, to account for any potential overpayment.
The Defendants rely on several matters in support of their contention that the agreement could not possibly have been based on actuals as suggested.
The first is that all of the schedules sent to the Claimants at the time of their recruitment referred to GULR, which is, on any view, an estimate. In my judgment the reference to GULR in the schedules does not undermine the Claimants’ case. In the first place, it was made abundantly clear at the time that any figure for GULR in the schedules was merely notional. Thus, there was never any suggestion that the 20% figure against GULR in those schedules would be a figure that would actually be used in any PC calculation. I accept that GULR is generally understood to be a best estimate calculated on an actuarial basis. As such, the repeated inclusion of that term in the schedules was apt to confuse because the agreement was not to rely upon any such actuarial number but to base the calculations on actual notified claims. However, it is clear that the schedules were pro formas laid out in the company’s usual format. Other than the mere fact of its inclusion in these pro forma schedules there is no contemporaneous evidence to suggest that the agreement reached between the parties was to use GULR to calculate PC. Indeed, the email sent by Mr Gregory on 30 January 2015 in which he said, “To reconfirm the loss ratio figure of 20% in the calc is an example number The calc will be based on actual at the close of say 2015”, makes it clear my judgment that GULR (as that term would normally be understood) would not form the basis of the calculation. Given that the Defendants’ case is that GULR is a figure that is carefully reviewed every quarter, it seems surprising that, if the intention had been to base PC on GULR, the relevant figure at that time was not used instead of a notional one.
The Defendants also rely upon the contents of the contractual amendment letters dated 8 February 2016, which refer to, “An estimate of the ultimate financial performance”, “…an initial forecast of the M&A bonus pool…”, “a payment of 70% of your PSP based upon this early estimate of the class profitability will be made”, and “Once the 2016 YOA is closed, the exact profitability will become known and the 2016 Bonus Pool will be recalculated.” Mr Solomon submits that each of these references to “estimates” and “forecasts” is necessarily a reference to GULR and that there would be no need to recalculate the PC Pool if it had been based on actual profit in the first place. The difficulty with that submission is that it is based on the incorrect notion that the Claimants’ case as to what was agreed involved no element of estimation at all. For reasons already set out, it is my judgment that the agreement did involve an element of estimation but based on actual notified claims. Seen in that light, none of the passages from the amendment letters highlighted above are actually inconsistent with the Claimants’ case. There is no reason why the “estimates” and “forecasts” referred to in the letter could not be based on actual notified claims as agreed. Moreover, the element of recalculation referred to in the letter is also consistent with the 30% holdback mechanism in the Claimants’ agreement. It is noteworthy that no reference is made to GULR in the body of the amendment letter (although it is referred to in the Schedule which, once again, uses the notional figure of 20%).
It is also said that any such agreement would be commercially unrealistic. Mr Dougall, in his evidence, went further and said that it would be “ridiculous” and “naive” to agree the PC on such terms. However, the fact that Mr Dougall, Mr Martin and others may have regarded the deal struck by Mr Lotter (for whom Mr Dougall clearly had little respect) and Mr Gregory as a very bad one is no reason in itself to conclude that it was unlikely to have been reached.
What Neon appeared to forget was that, as is evident from the communications at the time, Neon was extremely keen to secure the Claimants’ services and it was evidently willing at the time to agree terms which might now appear to Neon to be somewhat uncommercial. I am satisfied that, given their situations at the time, the Claimants would not have joined a loss-making entity such as Neon without the terms as to PC that I find were agreed. I also consider it highly unlikely that the Claimants would have agreed to a PC scheme based on GULR (in the usual sense) which would involve the wider Neon business, and/or which would include an element of IBNR. Mr Brown gave unchallenged evidence that he would not have accepted such an agreement. Ms Bhoma and Ms O’Reilly were equally clear as to their understanding. It seems highly unlikely to me that these three experienced and highly regarded M&A underwriters could have misunderstood what Mr Lotter and Mr Gregory had actually communicated to them as to the calculation of the PC. A ring-fenced, actual loss-based PC was a vital element of the deal for each of them and the contemporaneous communications, such as they are, support rather than detract from their case that that was what was agreed.
In seeking to highlight the supposed commercial unreality of the Claimants’ case, Mr Solomon referred me to the response given by Mr Harman to questions about the actual and estimated basis of calculating PC, which was that the two are “opposites” and that “you can’t put those two things together”. Mr Harman went on to say, however, “But if you’re doing it purely on a different outside of the normal insurance industry calculation, then, yes”. What Mr Harman appears to be accepting here is that it would be possible, but outside the norm, to calculate PC on the basis contended for by the Claimants. Mr Harman also accepted (in relation to questions about the meaning of the amendment letters) that “in principle” there was no reason why an estimate of ultimate financial performance could not be based upon actual notified losses to calculate PC. It is also worth noting that this approach to calculating PC is contemplated in the consortium agreement itself. At paragraph 8 it provides:
b. ‘Known Outstanding Losses’ means, following receipt of a notification of a claim under a policy bound pursuant to this Consortium Agreement, an amount equal to the reserve that the Claims Team and the Consortium Leader reasonably believes should be posted against such a claim.” (Emphasis added).
Mr Dougall suggested that the consortium agreement was different because it included a deficit provision, allowing Neon to claw back any over-payments made on a Known Outstanding Losses basis. However, it seems to me that the 30% holdback arrangement agreed with the Claimants allows for a similar clawback.
A further point made by the Defendants is that the Claimants’ basis of calculating PC would be unacceptable to the regulator as it would involve a GULR which failed to take account of required elements. However, it seems to me that whereas GULR would need to be prepared on a certain basis for the regulator’s purposes, particularly in relation to a reserving or accounting exercise, there is no regulatory requirement precluding the calculation of PC on an “actual” loss basis. Indeed, Mr Harman accepted in his evidence that the calculation of a PC agreed under a contract was different to making a reserve under Lloyds’ valuation of liability rules, and that calculating PC on an actuals basis would have no impact on Neon’s regulatory position.
A final point raised by Mr Solomon in oral closing submissions was that the existence of “entire agreement” clauses in the various contracts preclude reliance on any oral agreements that may have been reached in respect of PC. I do not accept that submission. It is clear that the agreement as to PC was always intended to be and was separate from the Contract of Employment, and so any entire agreement clause therein is of no effect as far as the PC was concerned. As for the PC Scheme Rules, the entire agreement clause in respect of that cannot apply for the simple reason that the offer letters to each of the Claimants made express amendments to the “standard profit commission rules”.
For those reasons, I have reached the conclusion that the original PC was to be calculated on an estimate of loss based on actual notified claims, or, as it has been referred to in the pleaded case, “actual losses”.
In any event, did each of the Claimants later agree a contractual variation that the PC would be calculated on estimated rather than actual losses?
For the reasons already set out in the previous section, I find that the amendment letters did not have the effect of changing the agreed basis on which PC was to be calculated. Thus, when Mr Brown agreed in cross-examination that it would be wrong for his PC to be calculated on a different basis from that which applied to Ms Bhoma and Ms O’Reilly, that was just a reflection of the fact that the amendment contracts had not changed the substance of the agreement as to PC reached with all three at the outset of their employment.
Was it a matter for the First Claimant’s discretion how to distribute the PC Pool?
It is quite clear that the discretion in this regard was to be exercised by Neon with input from Mr Brown. That was Mr Brown’s evidence. I accept that this evidence was inconsistent with the pleaded case which suggested that the discretion lay entirely with Mr Brown. However, I do not consider that this inconsistency undermines the Claimants’ case as to the PC more generally. It is a detail in the Particulars of Claim which, as Mr Brown stated, appears to have been “overlooked”. Given the speed with which this matter has been brought to trial it is perhaps not altogether surprising that one or two such inconsistencies have not been spotted.
Alleged failure to pay discretionary bonuses and pay rises
Was the First Defendant entitled to withhold the Claimants’ pay rises and discretionary bonuses sums under clause 5 of the Restrictive Covenant Agreement, because the Claimants did not accept the New Terms?
The material sentence of para. 32 of the Defence and Counterclaim reads:
“Pursuant to clause 5 of the Restrictive Covenant Agreement, Neon Management was contractually entitled to make payment of the pay rise and discretionary bonus conditional on acceptance of the new post-termination restrictions contained in the New Terms”
However, clause 5 (which is set out above) refers only to the conditionality in respect of pay and bonus being related to the review of the PTRs; it does not suggest that pay and bonus may be made conditional upon other matters, for example the PC. On a proper reading of the clause, the only condition that may be imposed in respect of pay and bonus is the review of PTRs; any other changes would not fall within the scope of the clause.
The Claimants say that the effect of the clause is even more limited in that only changes to the PTRs which involve tidying up and/or which are not substantially more onerous than existing restrictions may be made. Reliance is placed upon the case of Daniels v Lloyds Bank plc [2018] EWHC 660 (Comm). However, Daniels is a case of a unilateral variation. There, the contract with the employer Bank contained a clause which allowed the Bank to change the relevant plan at any time and, pursuant to that clause, the Bank purported to introduce a new term by which it could adjust down to nil the number of shares which would vest. Cockerill J held that the clause which permitted the Bank to amend, was not apt to cover the introduction of the new clause.
Clause 5 is not a unilateral variation clause. It confers upon the Defendants an ability to withhold a pay review or bonus award when the Claimants refuse to sign up to new PTRs. If the Claimants refused, their contract would not be varied. In my judgment, clause 5 would permit the introduction of more extensive PTRs as a condition of being paid the salary and bonus. There is nothing inherently unfair about that since the extent and scope of any revised PTRs would still be subject to the requirement that they be reasonable. It has never been argued here that the proposed new PTRs were unreasonable or not required for a legitimate business purpose.
The real question here is whether the Defendants were entitled to impose other conditions going beyond the acceptance of the revised PTRs in respect of the payment of salary and bonus.
The Claimants were cross-examined on the basis that they would not have signed up to the new PTRs even if those were the only changes to their contracts of employment. It is right to say that Ms Bhoma and Ms O’Reilly did say that they would not have accepted the changes to the PTRs if these had been sent to them and that Mr Brown said that, given the choice, he would not accept. The purpose of that line of cross-examination appears to be in order to set up an argument based on Lavarack v. Woods of Colchester Ltd. [1967] 1 QB 278 whereby damages for breach of contract would be assessed on the assumption that the employer would have performed the contract in the way most beneficial (or least onerous) to him. However, the question here is not whether the Defendants could have performed the contract in a different way, but whether or not they had breached the implied term as to trust and confidence in seeking, amongst other things, to impose additional conditions in respect of the payment of declared salaries and bonuses. I do not, therefore, regard it as being of particular significance in the circumstances of this case that the Claimants made admissions as referred to above.
The fact is that the revised PTRs were not the only changes being introduced. The further changes comprised changes to the pension contributions, changes to the holiday pay of Ms Bhoma, extensive new PTRs, changes to the bonus awards (by introducing a clawback mechanism), and most significantly, an express requirement to forego any contractual entitlement to PC for a purely discretionary one.
As to those further changes, the Defendants’ case is that they were not detrimental. As far as the holiday pay is concerned, I agree with the Defendants. Ms Bhoma had a holiday entitlement equivalent to a full-time worker notwithstanding the fact that she worked part-time. The revised contract purported to reduce her holiday entitlement on a pro-rata basis to match her part-time hours. I accept Ms Andrew’s evidence that this was an administrative oversight and had it been raised with her or HR at the time it would have been remedied. Mr Craig very fairly accepted that if the reduced holiday entitlement were the only additional condition being imposed then this litigation probably would not have arisen.
I turn therefore to consider the other conditions and I begin with the changes to the pension contributions.
Pension contributions
The Claimants had a contractual entitlement to pension contributions based on a percentage of their salary. This was substituted with a discretion to pay the difference between: (a) 10% of basic salary; and (b) £10,000. The relevant clause is 5.3 (g) of the proposed new Employment Handbook, which provides:
“If your Basic Salary is greater than £100,000 the Company may, in its sole discretion, pay you the difference between 10% of your Basic Salary and 10% of your Pensionable Salary in equal monthly instalments, via payroll, less normal payroll deductions.”
The Defendants say that whilst clause 5.3 of the proposed new Handbook gave Neon a discretion in relation to any differences in relation to pension contributions, it had made clear in writing to all staff (including the Claimants) how that discretion would be exercised. Ms Andrew confirmed that the discretion would have been exercised in that way. On that basis, say the Defendants, the change was not detrimental. Criticism is made of the Claimants, and of Ms Bhoma and Ms O’Reilly in particular, for not taking care to read the communications in respect of pension and for failing to raise queries with HR and/or other affected colleagues about the matter. However, whether or not they did so does not change the reality which is that the changes to pension contributions were detrimental. The fact that the discretion may be exercised in accordance with what was stated in the relevant email does not change the fact that what was previously a contractual entitlement to a certain level of contributions was now payable at the “sole discretion” of the employer. Moreover, Ms Andrew accepted in cross examination that although the discretion had been exercised favourably for the current year, it would “not necessarily” decline to exercise discretion in other years and confirmed that the discretion was “in there just so we have discretion if we need it”. In other words, it was far from guaranteed that the discretion would consistently be exercised in the way it had been in 2018. That was, in my judgment, plainly a less favourable position for the Claimants than had hitherto been the case.
The Defendants make these criticisms of the Claimants in order to demonstrate that all they were concerned about was the PC and had no real concerns about any of the other matters now being relied upon as amounting to a detrimental change to their contract. Whilst the PC was of paramount concern to the Claimants, I do not accept that the other matters, including the pension contributions issue, were irrelevant. Each of the resignation letters refers to other detrimental terms: Ms O’Reilly states that her position at Neon has “become untenable due (amongst numerous matters) to the proposed detrimental changes to my contract of employment, including the profit commission scheme, which you are forcing on me”; Mr Brown states that, “Now my class profit commission has been taken away from me under proposed new contractual terms that are utterly unacceptable for this and other serious reasons”; and Ms Bhoma, refers to “Neon’s attempt to force new contractual terms on me… including (but expressly not limited to) by denying me a pay rise and the bonus which Neon plainly recognises I am entitled unless I agree to the new terms and conditions (which are plainly detrimental…)… has caused an irreparable breakdown in the trust and confidence…”. There can be no suggestion in those circumstances that the Claimants concerns related only to PC.
PC entitlement
Ms Andrew accepted that the Claimants were entitled to a contractual PC for the 2016 YOA. However, she maintained that there was no entitlement for subsequent years. I do not accept that contention for the following reasons:
i) The Claimants’ offer letters state that the profit commission scheme “is an annual arrangement” and that they would “be considered for subsequent years of account in the same way as other underwriters”;
ii) In an email from Megan Field to Mr Brown on 4 March 2015, Ms Field stated that although membership of the PC scheme was reviewed annually, it was “completely understood” that if Neon were to withdraw the scheme, it would lose its best underwriters;
iii) There is no evidence that it had been suggested to the Claimants at any stage before 2018 that they were not still participating in a profit commission scheme for 2017 YOA;
iv) On the contrary, Neon’s discussions with the Claimants in March 2018 were all predicated on the fact that they were being required to “forego” their PC scheme because Neon wanted them to be in the same position as others;
v) In its letters of 8 February 2016 Neon had expressly told Ms Bhoma and Ms O’Reilly that it would either maintain their PC scheme for 2017 or else replace it with something “at least as beneficial” (Emphasis added).
There can be little doubt that a purely discretionary bonus is less favourable than one based upon a contractual formula: see, for example, Khatri v Cooperatieve Centrale Raiffeissen Boerenleenbank [2010] IRLR 715. This was detrimental irrespective of whether the method of calculation was correct.
Bonus clawback
The Defendants say that, as this particular detrimental change is not pleaded by the Claimants and does not form part of the Agreed List of Issues, the Court should ignore it. The relevant passage is at paragraph 28 of the Particulars of Claim. It states that, “The New Terms would have been materially less favourable to each of the Claimants than the existing terms of the Contract of Employment, inter alia by…”, and goes on to list the pension contributions, holiday pay and the introduction of extensive new PTRs. The use of the phrase ‘inter-alia’ seems to me to be significant as the Claimants were not confining themselves to the three matters listed. I accept that no further particulars are provided as to what else might be relied upon, but equally, none were sought. The issue of the bonus clawback was presaged in the witness statements and it cannot be said that the Defendants were taken by surprise by it. I therefore consider that it is appropriate for me to consider it. I can deal with it briefly.
The letters dated 7 March 2018 introduced a provision stating that:
“If you give notice to terminate your employment with the Company on or before 23 September 2018 [in Ms Bhoma’s case], 100% of the net amount of the 2017 bonus received by you will become immediately due and repayable to the Company.
Ms Andrew accepted in evidence that this could fairly be described as a “handcuff” on the Claimants and that it was detrimental to them. In my judgment, it is clear that this is a detrimental change in respect of pay. It renders a declared bonus payment repayable in the event that notice of termination is given, whereas previously a declared bonus was not repayable once paid. Ms Andrew also said that Neon only intended to impose this condition because it did not have a mechanism for deferring payment of bonuses over the course of the year.
In Farrell Matthews & Weir v Hansen [2005] ICR 509 per Nelson J at [61], it was held an employer’s decision to pay bonuses in instalments over the course of a year, rather than paying immediately when due, was a significant factor in the EAT’s decision (upholding that of the employment Tribunal) that an employee had been constructively dismissed. In the present case, it would appear that as Neon did not have the mechanism to defer bonus (which could itself have been repudiatory, according to the judgment in Farrell), it decided to impose a more onerous condition.
Did clause 7.4 of the Employment Contracts entitle the First Defendant to withhold payment of those discretionary bonuses because the Claimants were on notice at that date?
Clause 7.4 provides:
“You shall not be entitled to receive a bonus if on the date that the bonus is due to be paid you are no longer employed (for whatever reason and howsoever caused and whether the termination of the Employment was in breach of contract or otherwise) by Marketform or any Group Company or you are under notice of termination of employment (whether such notice is given by you or Marketform) or on Garden Leave, or subject to a disciplinary investigation, or suspended pursuant to the terms of this agreement.”
The Defendants contend that this provision bites in respect of the discretionary bonuses because all of them gave notice on 16 March 2018 – before the payment date of 23 March 2018 (being the March payroll date) for their discretionary bonuses.
Clause 7.4 makes clear that if an employee was no longer employed as at the bonus payment date then the entitlement to bonus would be lost irrespective of the reason for termination and even if that termination was in breach of contract. However, clause 7.4 does not similarly stipulate that bonus may be withheld when notice is given”for whatever reason and howsoever caused and whether [because of] a breach of contract or otherwise”. Instead, the clause provides that the bonus will not be payable “whether such notice is given by you or Marketform”. Thus, on a proper construction, the Claimants would not be disentitled from receiving their declared bonus awards in March 2018 if notice was given in circumstances where Neon was in fundamental breach of contract.
If there had been such breach, then Neon could not rely upon its own breach of contract as a reason for not paying the sum. As the House of Lords made clear in Alghussein Establishment v Eton College [1988] 1 WLR 587, there is a well-established rule that a party cannot take advantage of his own wrong:
“A party who seeks to obtain a benefit under a continuing contract on account of his breach is just as much taking advantage of his own wrong as is a party who relies on his breach to avoid a contract and thereby escape his obligations.” Per Lord Jauncey at 593–4
That supports the fact that on a proper construction of clause 7.4, the Claimants would not be disentitled from receiving their declared bonus awards if they gave notice because of Neon’s breach of contract, a fortiori where that breach was repudiatory (as it was here). Clear words would have to be used to exclude an entitlement to a declared bonus in circumstances where the contract provided at clause 7.3 that an employee became entitled to receive a discretionary bonus once it was “declared” (as it was in the 7 March 2018 letters to the Claimants).
In any case, did the First Defendant mislead the Claimants as to the (un)favourableness of the New Terms to them?
This claim is based on the communication from HR to all employees on 27 February 2018, stating, in answer to the question, “Have there been any changes to my existing terms?”:
“Yes, although we hope that you agree that the changes are beneficial to you.”
In my judgment, this email, to which none of the Claimants paid particular attention at the time, is not misleading. It expresses a hope that the contractual changes, taken as a whole, are regarded by the employees as beneficial. However, it falls far short of providing any clear assurance that particular terms which have been changed will be more beneficial in every case than those which they replace.
Alleged failure to pay Unpaid PC
The Defendants’ primary case in respect of this issue is that the PC had been calculated on a correct GULR basis. However, for reasons set out above, I have concluded that the Defendants’ approach to the PC was not consistent with what had been agreed with the Claimants when they were recruited. As such, a question does arise as to whether or not there was a failure to pay the correct amount by way of PC.
Did the First Defendant contractually vary the date of its obligation to pay the 2016 First PC Tranche to March 2018 under clause 7.3 of the Employment Contracts?
If so: (i) Did clause 7.4 of the Employment Contracts entitle the First Defendant to withhold payment of that PC because the Claimants were on notice at that date? and (ii) Did the First Defendant waive that entitlement by making (allegedly part) payment of it on 23 March 2018?
The issue here is whether or not the Defendants were in breach in changing the payment date for the PC which had previously been December 2017. It only applies in respect of Ms Bhoma and Ms O’Reilly because Mr Brown’s PC arrangements were not subject to the changes imposed by the letters sent to Ms Bhoma and Ms O’Reilly on 8 February 2016.
I have already dealt above with the suggestion that a change to the date of payment was made in writing by the delivery of slides first shown at the Town Hall meeting in November 2017. Such slides were not, in my judgment, effective to change the date of payment. The Defendants’ alternative position is that insofar as the change of payment date amounts to a breach of contract any such breach was waived and/or affirmed by Ms Bhoma and/or Ms O’Reilly. Reliance is placed upon parts of their cross-examinations an example of which is as follows:
“Q. And he told you that it was at the end of March and you were content with that?
A. He explained that he could raise with HR, if I wanted to receive the payment earlier, given that my 2016 profit commission had, in fact, been due in December 2017; and I told him that he did not need to raise it with HR.
Q. Okay. So you specifically took the decision not to raise a concern with HR?
A. Yes, I did.
Q. And therefore, you were content with your payment being received in March?
A. Yes.”
I do not find that such concessions in cross-examination are indicative of a waiver or affirmation on the part of Ms Bhoma and/or Ms O’Reilly in respect of the payment date. When the changes were first announced at the Town Hall meeting, there was no suggestion that the proposed changes were intended to be contractual and/or applicable in respect of any future payment dates beyond 2018. In the circumstances it seems to me that the position as to the proposed change of payment date was not sufficiently clear to enable Ms Bhoma and/or Ms O’Reilly to be in a fully informed position to waive or affirm any breaches of contract. Accordingly, I find that the payment date in respect of the PC remained as originally agreed, namely December 2017. Notice of resignation had not been given as at that date and therefore clause 7.4 did not apply.
It has subsequently been suggested by Ms Andrew that the payment of PC was a gesture of goodwill. However, the email dated 19 March 2018 in which Ms Andrew sets out the payments refers to the PC pool as being “now due” with no suggestion of it being made as a gesture of goodwill. Furthermore, there was no suggestion that reliance had been placed on clause 7.4 and the fact that notice had, by that stage, already been given. I find that this payment was made because the Defendants recognised at the time that it was a sum that was contractually due to the Claimants. The payment was, however, not correctly calculated as it was based on a GULR figure of 48%.
If (contrary to the Claimants’ primary case) the PC was to be calculated on estimated figures, did the First Defendant breach the PC Terms and/or the duty in issue by including a significant estimated loss without reasonable basis?
The Claimants’ case in this regard, if I have correctly understood it, is that a loss ratio of 48% applied by Mr Harman in his calculation of the PC was outside the bounds of a rational estimate. However, Mr Harman was applying a GULR that was not based on actual losses as agreed with the Claimants. Mr Dougall had not provided Mr Harman with all the documentation relevant to the terms agreed with the Claimants including, in particular, any correspondence referring to PC being based on actual numbers. In those circumstances, it is not surprising that Mr Harman took the approach that he did. His approach, which was not based on actual notified claims, was consistent with the usual approach to GULR that would apply when there was no specific agreement otherwise. I cannot describe the taking of that approach in those circumstances as unreasonable or irrational in the sense described in Braganza v BP Shipping Ltd [2015] 1 WLR 1661 per Lady Hale at [30], [32].
Alleged repudiation by the First Defendant
Did the First and the Second Claimant affirm or waive any alleged breaches in relation to the pay-rises, discretionary bonuses and the alleged Unpaid PC by resigning on notice on 16 March 2018?
The Defendants’ case is that by resigning on notice on 16 March 2016, Mr Brown and Ms Bhoma elected to affirm the alleged repudiations to that date and keep their contracts alive. The Claimants contend that even if they had thereby affirmed the contract the Court can and should take into account those matters prior to 16 March in determining whether the post 16 March events amount to a repudiatory breach of contract. Reliance is placed on the recent decision of the Court of Appeal in Kaur v. Leeds Teaching Hospitals NHS Trust [2018] EWCA Civ 978 where it was held that an employee who is a victim of a continuing cumulative breach of contract is entitled to rely on the totality of the employer’s acts notwithstanding a prior affirmation:
“51 I am afraid I cannot agree with that passage. As I have shown above, both Glidewell LJ in Lewis and Dyson LJ in Omilaju state explicitly that an employee who is the victim of a continuing cumulative breach is entitled to rely on the totality of the employer’s acts notwithstanding a prior affirmation; provided the later act forms part of the series (as explained in Omilaju) it does not “land in an empty scale”. I do not believe that this involves any tension with the principle that the affirmation of a contract following a breach is irrevocable. Cases of cumulative breach of the Malik term (which was not the kind of term in issue in either Safehaven or Stocznia Gdanska ) fall within the well-recognised qualification to that principle that the victim of a repudiatory breach who has affirmed the contract can nevertheless terminate if the breach continues thereafter. It is true that, as Safehaven says, the correct analysis in such a case is not that the victim can go back on the affirmation and rely on the earlier repudiation as such: rather, the right to terminate depends on the employer’s post-affirmation conduct. Judge Hand may therefore have been right to jib at Lewis J’s reference to “reactivating” the earlier breach (though, to be fair to him, he did say ” effectively re-activates”); but there is nothing wrong in speaking of the right to terminate being revived, by the further act, in the straightforward sense that the employee had the right, then lost it but now has it again.
…
55 I am concerned that the foregoing paragraphs may make the law in this area seem complicated and full of traps for the unwary. I do not believe that that is so. In the normal case where an employee claims to have been constructively dismissed it is sufficient for a tribunal to ask itself the following questions:
(1) What was the most recent act (or omission) on the part of the employer which the employee says caused, or triggered, his or her resignation ?
(2) Has he or she affirmed the contract since that act ?
(3) If not, was that act (or omission) by itself a repudiatory breach of contract ?
(4) 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 ? (If it was, there is no need for any separate consideration of a possible previous affirmation, for the reason given at the end of para. 45 above.)
(5) Did the employee resign in response (or partly in response) to that breach ?
The Defendants further submit that the most recent acts (in this case those that came after 16 March 2018) must be considered to contribute “something” to the earlier acts, applying the approach in Omilaju v London Borough of Waltham Forest [2005] ICR 481, and that the post-16 March 2018 acts relied upon in this case do not add “something”.
In my judgment, it is clear that by resigning on notice on 16 March, Mr Brown and Ms Bhoma affirmed their contracts of employment. It is well-established that in the face of a repudiatory breach of contract the employee must not leave it too long before resigning otherwise he will be taken to have affirmed: see Western Excavating v Sharp [1978] QB 761 (CA) at 769C–D, per Lord Denning MR. In the present case, whilst Mr Brown and Ms Bhoma did reserve all their rights, they clearly indicated that they would be working out the entirety of their notice periods, which, in Mr Brown’s case, involved a further year of employment. It would be unconscionable to keep one’s right to discharge a repudiated contract alive for that length of time in the absence of any further breaches of contract. Of course, if there are further breaches of contract then, as per the judgment of the Court of Appeal in Kaur, such breaches would not “land in an empty scale” and may be taken into account with the pre-16 March 2018 breaches. Whether or not there were further breaches post-16 March 2018 and whether they add “something” to the earlier breaches is considered below.
In any case did the First Defendant repudiate the First and Second Claimants’ Employment Contracts (and thereby wrongfully dismiss them)?
This issue comprises several elements. For clarity, I shall set out the issue in full as it appears in the list of issues before dealing with each element in turn:
In any case, did the First Defendant repudiate the First and Second Claimants’ Employment Contracts (and thereby wrongfully dismiss them) by:
(1) Not paying in March and/or April 2018:
(a) the pay rises it had determined to award them (backdated to 1 January 2018) and/or
(b) the discretionary bonuses it had determined to award them and/or
(c) the alleged Unpaid PC?
(2) Making findings, allegedly without proper basis, expressed:
(a) In its email dated 20 April 2018, that they had
(i) breached (unspecified) contractual obligations
(ii) breached common-law duties of confidentiality and/or
(iii) forwarded (unspecified) information confidential to the First Defendant from their work email addressed to their private email addresses with “no legitimate business reason”?
(b) In its email dated 24 April 2018, that they had
(i) breached clauses 9.(2)(a)–(d) (in unspecified respects) and 18.1 of their Employment Contracts and their duties of good faith and fidelity
(ii) “Hid[den] behind the notion that employees need to rely on their personal email accounts to perform their role” and that this was “untrue” and/or
(iii) no intention of complying with their contractual obligations?
(c) In its letters dated 26 April 2018, that they had
(i) breached clauses 4 (as regards the Second Claimant, in unspecified respects) and 20 of their Employment Contracts
(ii) the company’s IT policy
(iii) failed to return confidential information and property as requested
(iv) been absent from the office without explanation
(v) not performed their duties (in unspecified ways) and/or
(vi) been “unprofessional” and in the First Claimant’s case “disruptive”
(3) Reaching the above conclusions without conducting an investigation in accordance with the term implied according to issue ?2?
(4) Raising (unspecified) concerns with Lloyd’s without warning or notifying them and/or
(5) Telling them by the letters of 26 April 2018 that it had “lost trust and confidence” in them and/or
(6) Any of these matters or combination thereof, together with any of its actions before their resignations on notice?
(1) Not paying in March and/or April 2018: (a) the pay rises it had determined to award them (backdated to 1 January 2018) and/or (b) the discretionary bonuses it had determined to award them; and/or; and (c) the alleged Unpaid PC?
The relevant legal principles are not in dispute. Payment of agreed remuneration goes to the heart of the employment relationship and a deliberate refusal to pay undermines the entire foundation of the contract of employment: see Cantor Fitzgerald International v Callaghan [1999] ICR 639 at 648G–649G.
In this case, Neon, by its letters dated 7 March 2018, awarded each of the Claimants a pay rise and declared the amount of discretionary bonus. It is also not in dispute that in ordinary circumstances, those pay rises and declared bonuses thereby became payable. The Defendants’ position is that as the Claimants did not agree the new PTRs, they were not entitled to their payments pursuant to clause 5.3 of the restrictive covenant agreement.
I have concluded above that the Defendants were not entitled to rely upon that clause to withhold the pay rises and bonuses because of the attempt to attach conditions that went beyond merely accepting revised PTRs. It follows that the Defendants’ failure to pay the pay rises and bonuses in March and April 2018 (and, in respect of the pay rises, to pay backdated amounts from January 2018) was a fundamental breach of contract.
As to the PC, the Defendants’ case is that there was nothing owing to the Claimants. However, for reasons already discussed above, it is my judgment that the Defendants failed to comply with the agreed terms as to the PC and calculated the amount incorrectly. Accordingly, the appropriate amount of PC for each of the Claimants was not paid. Furthermore, again for reasons already discussed above, the Defendants’ defence that the bonuses and the PC were not payable because the Claimants were on notice as at the date of payment does not apply.
(2) Making findings, allegedly without proper basis, expressed:
(a) In its email dated 20 April 2018, that they had: (i) breached (unspecified) contractual obligations; (ii) breached common-law duties of confidentiality and/or (iii) forwarded (unspecified) information confidential to the First Defendant from their work email addressed to their private email addresses with “no legitimate business reason”?
This issue describes the matters set out in the email dated 20 April 2018 as “findings” made without proper basis. I agree with that description. There can be no doubt that, even at this early stage in the dispute, the Defendants had reached firm conclusions as to the Claimants’ conduct. Not only does that emerge from the terminology used in the email (which included references to Mr Brown and Ms Bhoma having “breached” their contractual obligations and common-law duties of confidentiality); it also emerges from the fact, as declared in that email, that the Claimants’ conduct had already been referred to the regulator.
The Defendants’ submission as to this email is that Ms Bhoma’s and Mr. Brown’s position “crumbled” under cross-examination as a result of their admissions that by sending emails containing confidential information to their personal email addresses they knew they were in breach of the IT policy. However, that submission fails to recognise that the findings set out in the 20 April 2018 email were not that there had been a breach of the IT policy – indeed, that policy is not mentioned – but that there had been breaches of contractual obligations and their common-law duties of confidentiality. In particular, it was said that Mr Brown and Ms Bhoma had “no legitimate business reason” for sending confidential information to their private email addresses. Ms Andrew accepted in cross-examination that, by 20 April 2018, she had reached a conclusion that “they had been sending this information for a nefarious purpose” and specifically because Neon believed that the information was going to be used to help the Claimants to compete with Neon in the future.
There are several difficulties with the Defendants’ position:
i) Firstly, it was readily apparent that the information sent by Mr Brown and Ms Bhoma (which was undoubtedly sensitive and confidential information) was sent for a legitimate work purpose:
a) thus, Ms Andrew accepted that the information sent by Ms Bhoma on 6 March 2018 concerned a business plan for Neon which she wanted to print off at home in order that she could mark it up for Mr Brown to send to Mr Reith;
b) there were limitations in Neon’s system which meant that it was not possible to print documents from work phones, and any attempt to print via Neon’s Citrix IT system would only produce a printout in the office printer. This was not something Ms Andrew investigated at the time but she accepted in cross-examination that that was the position;
c) Mr Brown did send the business plan with Ms Bhoma’s input to Mr Reith the following day. Ms Andrew’s evidence as to that was as follows:
Q. And Mr Brown, we know, did send the plan to Mr Reith, the following day, 7 March. We have just seen it haven’t we?
A. Yes.
Q. So that would have been work that she was doing as part of her job for Neon; correct?
A. Correct .
Q. And for the benefit of Mr Reith?
A. Correct .
Q. And for the benefit of Neon?
A. Yes .
Q. That is a legitimate business purpose, isn’t it ?
A. Yes , it is .
Ms Andrew did not, at the time, take the step of enquiring with Mr Reith whether he had received the business plan.
d) The information sent by Mr Brown on 19 February 2018 comprised two spreadsheets containing up-to-date information that he required for meetings at work and so that he could open them on his iPad Pro tablet;
e) Ms Andrew also accepted that that would have been done for a legitimate business purpose “if Mr Brown had sent himself financial data in a summarised version”. However, the distinction which Ms Andrew seeks to make between summary information, which she accepts would be legitimate, and the full dataset in the spreadsheets, is difficult to understand given that even the summary would still contain confidential and sensitive information. The other obvious difficulty with Ms Andrew’s approach is that none of this was explored at the time as it could have been.
ii) Secondly, Mr Brown and Ms Bhoma were not given any opportunity to explain the purpose of sending these emails because none of the findings as to breach were particularised in Ms Andrew’s email of 20 April 2018.
iii) Thirdly, it was apparent that the sending of emails to personal accounts was not confined to Mr Brown and Ms Bhoma. I have already dealt above with Mr McKay’s use of his personal email addresses. It was accepted in Neon’s subsequent email of 24 April 2018 that employees did “on occasion and in limited situations” (which were not defined) use their private email accounts. In February 2017, Ms Tricia Chong had sent an email to Mr Brown’s private email address containing very similar data to that which he had sent himself in February 2018. It also emerged that Mr Brown had on many more occasions sent information to his private email address from early 2016 onwards and that Ms Andrew was aware of this from her search of his emails. Ms Bhoma also gave unchallenged evidence that the Head of IT was aware that she forwarded emails to her private email address. Furthermore, Ms Andrew accepted that even Mr Reith, the CEO, probably did send emails from his work email to his private email and that she had told Mr Brown as much.
iv) Fourthly, there was absolutely no evidence at the time (or now) that any of the information had been sent or forwarded to a third party so as to give rise to a breach of confidence.
v) Fifthly, although the material was not sent in an encrypted form, it is clear that the personal accounts used by Mr Brown and Ms Bhoma were password protected. Mr McKay did not password protect or encrypt documents he sent and said it was not possible to do so from his phone in any event. Ms Andrew accepted that no training was provided to employees on how to encrypt email attachments.
It can be inferred from all of these points that Neon was well aware that the use of personal email addresses was, if not commonplace within the organisation, certainly widely tolerated, and that Ms Andrew had fixed upon the emails sent in February and March 2018 not because of any reasonably grounded belief that these had been sent for illegitimate purposes but simply because they were the most proximate in time to the resignations.
It is for these reasons that the Defendants’ reliance upon breaches of the IT policy does not advance their case. Breaches of the IT policy cannot, in my judgment, be equated with breaches of contractual obligations and breaches of confidence, which were the matters expressly relied upon in the email of 20 April 2018. Nor is it the case that a breach of the IT policy automatically renders illegitimate an act which is otherwise done for a legitimate business purpose. I should note here that much was made of the fact that Mr Brown had used a Hotmail address and that he knew that “for reasons of confidentiality” such an address should not be used. Indeed, Mr Solomon in his oral submissions went as far as to suggest that the mere fact that information passes through a Hotmail or Gmail server means that it is going to a third party because it is then no longer controlled by Neon. I do not accept that submission. In the first place, there was no evidence that, by using a Hotmail server, Mr Brown and Ms Bhoma were acting differently from other users of private email addresses whose actions were clearly tolerated. Furthermore, it would appear that this point arises out of an email exchange between Mr Brown, Mr Dougall and Mr Lednor in February 2017 (during which, incidentally, Mr Dougall appears to accept that he too forwards material to his own email in order to be able to print it) in which Mr Brown said that, “It’s not secure to forward out of the Neon system to Hotmail.” However, this exchange arose as a result of the difficulty which Ms Bhoma was having in printing documents and was with a view to obtaining an improvement in the system. This admission about the use of the Hotmail system, therefore, takes the Defendants’ case no further than the Claimants’ admissions as to the breaches of the IT policy.
The Defendants submit that the context in which the email dated 20 April 2018 was sent is also important. They highlight that the Claimants had resigned together on the same day, that there was material to suggest that Mr. Brown had concealed his meeting with Mr. Louden and that Mr. Louden had then lied to Neon on Mr. Brown’s behalf. Only the first of those is material given that I have found that Mr Brown was not in fact seeking to conceal his meeting but was trying to cancel it and that there was no conspiracy between Mr Louden and Mr Brown in this regard.
As to the resignations, they too must be seen in context. These were not resignations that ‘came out of the blue’ so as to take Neon by surprise. It is clear that the Claimants had each expressed very serious concerns about the changes to their terms and conditions of employment, and in particular to the removal of the PC entitlement, in the days leading up to the resignations. The Defendants, as I have found, took what has fairly been described as a “take it or leave it” approach to the concerns. Indeed, Mr Dougall had given an ultimatum to Mr Brown suggesting that if he did not accept the terms on offer then they would have to “call it a day”, and Mr Reith, in an internal exchange just days before the resignations (in which it was clearly implied that Mr Brown was an undesirable because of his “toxic short-termism”) wondered whether “we are coming to the end of the line here”.
In that context, the resignations cannot be said to be unexpected or worthy of immediate suspicion. And yet, having effectively told the Claimants’ that they could “take it or leave it”, Neon, instead of taking pause, responded to their decisions to “leave it” by immediately concluding that there was wrongdoing. In my judgment, that rush to so conclude was unjustified and did not have a reasonable foundation.
A further contextual matter relied upon by the Defendants is the Claimants’ refusal to give the requested undertakings. However, the request for such undertakings was predicated on the findings of breach set out (in an unparticularised fashion) in the 20 April 2018 email. Given that there was no substance to those findings, it is understandable that the Claimants were reluctant to give wide-ranging undertakings and sought instead to understand the basis for Neon’s concerns.
(b) In its email dated 24 April 2018, that they had: (i) breached clauses 9.(2)(a)–(d) (in unspecified respects) and 18.1 of their Employment Contracts and their duties of good faith and fidelity; (ii) “Hid[den] behind the notion that employees need to rely on their personal email accounts to perform their role” and that this was “untrue”; and/or (iii) no intention of complying with their contractual obligations?
By this stage, Mr. Brown and Ms Bhoma had, through their Solicitors, responded to Neon’s email dated 20 April 2018. The Defendants submit that the response dated 23 April 2018 is unhelpful because, instead of admitting that they had breached the IT policy and giving the undertakings sought, they suggested that the findings of breach were “baseless”. In my judgment, for reasons already set out above, the description of Neon’s findings of breaches of contractual and confidentiality obligations (not the IT policy which had not featured by that stage) as “baseless” was reasonable and correct. Mr Brown and Ms Bhoma did accept that they had used their personal email addresses and sought to explain as best they could, given the unspecified nature of the allegations, the basis for doing so.
The Defendants’ response on 24 April 2018 was, for the first time, to assert a breach of the IT policy and rejected the explanations provided as to why private email addresses were used. In doing so, Neon set out further findings of wrongdoing, stating that Mr Brown and Ms Bhoma, were in breach of each of clauses 9.2(a), 9.2(b), 9.2(c) and 9.2(d) of their employment contracts. These relate to non-competition and non-solicitation during employment. It is relevant to note that once again Neon’s position was not that misconduct was merely suspected but that it had made conclusive findings that there had been breaches. Given that stance, it was therefore somewhat surprising that there was no evidence before me of any breaches of these provisions, and Ms Andrew was not able satisfactorily to explain the basis for them in cross-examination. It is noteworthy that these further alleged breaches form no part of Neon’s pleaded case or counterclaim.
Neon went on in that email to acknowledge that other employees did on occasion and in limited situations use their private email accounts but suggested that Mr Brown and Ms Bhoma were “attempting to justify their behaviour by hiding behind the notion employees need to rely on their personal email accounts to perform their role” and that this was “simply untrue,”. The analysis of the position as to the use of personal email addresses in the previous section demonstrates that this allegation that Mr Brown and Ms Bhoma were giving a false explanation for their conduct was unwarranted. It would also appear that although Neon clearly tolerated other employees behaving in a similar fashion Neon was choosing to single out Ms Bhoma and Mr Brown for their conduct. Ms Andrew accepted that no action had, to her knowledge, ever been taken against other employees for forwarding documents from work to private email addresses.
The email also reiterated that Neon had raised its concerns with Lloyds and that it was not willing to correct any information that had been passed on. However, for the reasons set out above, it is my judgment that none of the matters relied upon could reasonably be characterised as “misconduct” within the meaning of the relevant bylaws and that, therefore, the reporting of the matter to Lloyds in this way was also unwarranted.
(c) In its letters dated 26 April 2018, that they had: (i) breached clauses 4 (as regards the Second Claimant, in unspecified respects) and 20 of their Employment Contracts; (ii) the company’s IT policy; (iii) failed to return confidential information and property as requested; (iv) been absent from the office without explanation; (v) not performed their duties (in unspecified ways) and/or; (vi) been “unprofessional” and in the First Claimant’s case “disruptive”
These letters had the effect of placing Mr. Brown and Ms Bhoma on garden leave. That was undoubtedly something which Neon was entitled to do. However, the Claimants’ complaint is not that they were placed on garden leave, but that by this email Mr Brown and Ms Bhoma were found, without justification, to have committed further acts of misconduct.
Thus, Mr Brown was found to have been “increasingly disruptive and unprofessional”, absent from the office without explanation on several occasions, and in breach of clause 4 of this contract (duties) by, amongst other things, not working to the best of his ability, not using best endeavours to promote Neon’s interests and not devoting the whole of his time, attention and abilities to his duties during working hours. No particulars were provided of any of these breaches. My findings of fact above include findings that Mr Brown was not seeking to be disruptive and that there was little or no work for him or Ms Bhoma to do in the weeks following their resignations. In the light of those findings, and in the absence of any particulars provided of these breaches in this email, the conclusion must be that these findings of breach were made without proper foundation. (See also the Counterclaim below).
Similar unparticularised allegations were made against Ms Bhoma. For similar reasons, these too were unwarranted.
Ms Andrew went on to state, in terms, that Neon had “lost trust and confidence” in both Mr Brown and Ms Bhoma.
In my judgment, the combination of making unwarranted findings (as opposed to raising allegations) against Mr Brown and Ms Bhoma, reporting their conduct to Lloyds without proper foundation, and stating that Neon had lost trust and confidence in them, amounted to a repudiation of the contract of employment.
(3) Reaching the above conclusions without conducting an investigation in accordance with implied terms?
I have expressed the conclusion above that whether or not a reasonable investigation is warranted will depend on the circumstances. There may be situations where the evidence of wrongdoing, even though circumstantial, presents an overwhelming picture of misconduct. In such circumstances, it may well be appropriate to come to a tentative or even firm conclusion that misconduct has occurred even before conducting an investigation. However, the circumstances in the present case were quite different. An investigation certainly was warranted here, not least because the misconduct being alleged appears to have involved conduct which was widely tolerated in other parts of the organisation. At the very least, these otherwise highly regarded employees ought to have been given the opportunity to explain the purpose of sending the emails in question before their conduct was reported to Lloyds. Furthermore, the context was one where the resignations on notice of a team (which had joined Neon as such) could not be said to be unexpected or so as to give rise to an immediate suspicion of wrongdoing.
In my judgment, there was, in the circumstances of this case, no reasonable or proper cause for not conducting an investigation before reporting the matter to Lloyd’s.
(4) Raising (unspecified) concerns with Lloyd’s without warning or notifying them
The Defendants contend that Neon was under a regulatory obligation to report its concerns to Lloyd’s as soon as practicable, and that there is no requirement to warn the Claimants in advance. In my judgment, for the reasons already set out, there was no reasonable foundation for concluding that Mr Brown or Ms Bhoma had committed or were intending to commit any act of “misconduct” as defined in the relevant bylaws. The rush to report the matter to Lloyds, without proper foundation and knowing the harm that this could cause to their professional reputations, was, in my judgment, calculated or likely to undermine trust and confidence.
(5) Telling them by the letters of 26 April 2018 that it had “lost trust and confidence” in them
I have dealt with this above.
(6) Any of these matters or combination thereof, together with any of its actions before their resignations on notice?
In my judgment, each of the matters considered in paragraphs 143 to 168 above amounts to a repudiatory breach of contract. If I am wrong about any particular matter relied upon, I am satisfied that those breaches, in any event, cumulatively amount to repudiatory conduct. These breaches post-16 March 2018 are certainly not trivial or innocuous and do add “something”, in the Omilaju sense, to the breaches that had gone before. They can therefore be added to the scales already weighed down by the pre-16 March 2018 conduct. Taking all of these matters together, Mr. Brown and Ms. Bhoma were therefore clearly entitled to resign as a result of Neon’s conduct, and they acted promptly in so doing. Although Ms O’Reilly did not leave on 1 May 2018, she is entitled to recover damages for the failures in respect of pay, bonuses and PC that apply to the others.
The Post Termination Restraints
If there was a repudiation, do the Post Termination Restraints fall away?
As I have found that the contract of employment was repudiated by Neon and such repudiation having been accepted, the rule in General Billposting Ltd v Atkinson [1909] AC 118 (HL) (“the General Billposting Rule”) would normally apply such that PTRs fall away. However, Mr Solomon invites me to reject that rule. His submissions in this regard may be summarised as follows:
i) There has been significant judicial comment to the effect that the General Billposting Rule should be revisited. In Croesus Financial Services Ltd. v. Bradshaw & Anr [2013] EWHC 3685 (QB) at 88, Simler J (as she then was) said:
“88…The time may have come to revisit the [General Billposting Rule] but in light of my findings, this is not the appropriate case to do it.”
ii) In Geys v Société Générale [2013] 1 AC 523, at [141] Lord Sumption said:
“141… In many contracts of employment, and perhaps in most modern ones, there is a large number of obligations which do not depend on the existence of the employment relationship. One example is the specific enforcement after a repudiation of express or implied covenant against competition, as in Lumley v Wagner 1 De GM & G 604. In appropriate cases, this may be subject to the proviso that the repudiation was not by the party in whose favour the covenant was included: see General Billposting Co Ltd [1909] AC 118…”
and at [68], Lord Wilson said:
“68 Contracts of employment often include provisions which are expressed to bind the parties following the termination of the contract: Rhys-Harper v Relaxion Group plc [2003] ICR 867 , para 36 (Lord Nicholls of Birkenhead). For example, they may oblige the employee not to compete with the employer for a specified period nor to use information which he has obtained in confidence during the period of his employment. Or, as in the present case, they may oblige the employer, within a specified period following termination of the contract, to make to the employee a termination payment, to be calculated in accordance with terms specified in it, and may oblige the employee, in consideration of the payment, to enter into a termination agreement on terms also therein specified. Such provisions of the contract are, by their terms, enforceable following its termination. The enforceability of, for example, a restrictive covenant by the repudiator against the innocent party is now the subject of some debate: Rock Refrigeration Ltd v Jones [1997] ICR 938 . There is no problem about the enforceability of such provisions against the repudiator.
iii) Most significantly, in Rock Refrigeration Ltd v Jones [1997] ICR 938, Phillips LJ (as he then was) at 958A-960B stated (albeit obiter) that the General Billposting Rule “accords neither with current legal principle nor with the requirements of business efficacy” (at 958 B). The Court gave the example of an employee who committed a repudiatory breach which was accepted by the employer, and comments that it would be “absurd” to suggest that the employee would thereafter be released from his negative post-termination obligations (at 959C). The same applies to an employer in repudiatory breach (at 959D-G). Further, the Court stated that General Billposting could be legitimately distinguished (at 959G et seq.).
In my judgment, none of these judicial comments, all of which were obiter, provides a firm foundation for setting aside such a long-established rule as the General Billposting Rule, particularly where, as in this case, it is the repudiator who seeks to enforce the PTRs against the innocent parties. The comment made by Simler J (as she then was) that the rule may need to be revisited was not based on any detailed analysis of the arguments on the issue. As for the comments of Lord Sumption and Lord Wilson in Geys, far from expressing a doubt as to the validity of the General Billposting Rule, they appear to approve the rule in so far as it applies to an attempt by the repudiator to enforce PTRs against the innocent party. That, as I have said, is this case. Those comments of the Supreme Court post-date, by some 20 years, the criticisms of the General Billposting Rule made by Phillips LJ in the Court of Appeal in Rock Refrigeration.
Perhaps of greater significance, given the terms of the Restrictive Covenant Agreement in this case, is Lord Sumption’s comment in Geys that, “Whether collateral obligations of this kind continue to bind after the termination of the contract… will normally depend on the construction of the contract…” (at [141]).
Apart from the fact these authorities come nowhere close to setting aside the General Billposting Rule, a further difficulty for Neon is that the Restrictive Covenant Agreement here does not contain any provision seeking to preserve the PTRs in the event of repudiation. Paragraph 6.1 of the PTRs provides:
“Notwithstanding the lawful termination of the employment contract, this agreement will remain in full force and effect.” (Emphasis added)
Mr Craig submits that the natural corollary of that provision is the recognition that the PTRs would not survive the unlawful termination of the employment contract. I agree. Thus, both on the construction of the relevant provision and on the basis of the General Billposting Rule, it is my conclusion that the PTRs in this case do fall away as a result of the Defendants’ repudiation of the Contract of Employment.
If so, do they fall away as against both Defendants?
The Defendant’s’ submission here is that as the Restrictive Covenant Agreement is between the Claimants and both Defendants, the repudiation is only by the First Defendant, and that the PTRs therefore do not fall away against the Second Defendant. I do not accept that submission. The PTRs, although contained in a separate agreement, were clearly part and parcel of the employment relationship. Clause 25.10 of Mr Brown’s Contract of Employment (and Clause 26.10 of Ms Bhoma’s) provides:
“This agreement together with the restrictive covenants to be entered into between Marketform, Marketform Management Agency Ltd and you on or around the date of this agreement (the Restrictive Covenant Agreement) and those sections of the Staff Handbook which are marked as having contractual status constitute the entire agreement of the parties in relation to the Employment…”
In light of that provision, I cannot see any valid basis for arguing that, post-repudiation, the PTRs somehow continue to survive as regards the Second Defendant.
The Counterclaim
Were the First and/or Second Claimants in repudiatory breach of their Employment Contracts and/or in breach of equitable and/or tortious duty by, individually or cumulatively:
Both being disruptive and unprofessional by spreading untrue rumours in the insurance market about the Second Defendant?
No particulars were provided in the Defence and Counterclaim as to the “untrue rumours” allegedly being spread. I was referred in written closing submissions to paragraph 56 of Mr Dougall’s statement. That refers only to the fact that Mr Brown was “communicating in the market that there was a contractual dispute between him and Neon”. I struggle to see what is untrue about that given that there clearly was a contractual dispute. No further particulars are provided in that paragraph and there was nothing in cross-examination to suggest that anything that Mr Brown or Ms Bhoma said about Neon was untrue. For these reasons, this allegation is not upheld.
Both being absent from the office and unavailable for work without permission?
The evidence in this regard is thin. It appears to comprise anecdotal observations by Mr Dougall that Mr Brown and Ms Bhoma appeared not to be at their desks as frequently as prior to their resignations and that their diaries did not appear to be particularly full. The diary entries are far from conclusive, as was clear from the evidence that not all work done was even entered into the diary. As for the apparent absences, Mr Dougall appeared to accept in cross-examination that Mr Brown had not been absent without permission. In respect of Ms Bhoma, there appears to have been an allegation that she took an extended lunch on 20 April 2018. The triviality of that allegation speaks for itself.
In short, having regard to the fact that Mr Brown was on holiday part of the period, there was little work to do in the period in any case and the absence of further particulars, I find that this allegation is not made out.
Both not performing their duties in accordance with clause 4 of their Employment Contracts and/or clause 18 of the Handbook?
This issue is said to be subsumed under the other issues for the counterclaim, but it boils down to an allegation that Mr. Brown, following his resignation on 16 March 2018, was no longer engaging with the M&A business and that the discussions which he and Ms Bhoma were having within the workplace were affecting morale. As to the lack of engagement, I have already made findings as to that; in short neither Mr Brown nor Ms Bhoma had much work to do in that period and Mr Brown, in particular, did not wish to be seen to be soliciting staff. This may have had the unfortunate effect of Mr Brown appearing to be somewhat disengaged. However, I do not find he was thereby breaching any provisions of his contract and nor was Ms Bhoma.
The First Claimant on 19 February 2018 emailing to his private email address, without permission, password protection or encryption, the Second Defendant’s confidential information of its 2017 and 2018 enquiries, quotes and deals, including tax aggregation figures and premiums?
The Second Claimant on 6 March 2018 emailing to her private email address, without permission, password protection or encryption, the Second Defendant’s business-plan?
These allegations have been addressed above. There were no breaches as alleged arising out of the sending of these emails. Insofar as there were breaches of the IT policy, the Defendants accept that the policy is not contractual.
Both preventing the Second Defendant from implementing a new structure for the M&A team?
I have concluded above that post-resignations there was little work to be done and that Mr Brown and Ms Bhoma had not sought to obstruct any restructuring that Neon tried to implement in order to keep the business afloat. This allegation is not upheld.
The First Claimant refusing to communicate and ignoring other members of the M&A class?
This has been addressed above. The allegation is not upheld.
The First Claimant on 19 March 2018, contrary to management instructions, discussing his resignation with Mr Louden and complaints about the Defendants?
This is perhaps the high point of the Counterclaim. Mr. Brown did discuss his resignation, and the reasons for it, with Mr. Louden on 19 March 2018, and Mr Brown had been informed earlier that day that Neon would communicate his resignation to the market and that he should not discuss his resignation with any third-party. However, as set out above, Mr Brown’s meeting with Mr Louden was long-standing. There had been an attempt to cancel it, but not to conceal it, and Mr Brown’s discussion of his resignation was prompted by a direct query from Mr Louden, who had by that stage already made the assumption that Mr Brown had resigned. Furthermore, I have rejected the contention that there was any conspiracy to deceive or mislead Neon, notwithstanding Mr Louden’s rather foolish attempt to feign ignorance in respect of Mr Brown’s resignation. In any event it is noteworthy that Mr Thornton gave evidence, which is confirmed by Mr Dougall as being accurate, that the M&A team were told that if they were asked, they could say that the Claimants had resigned because they had issues with their new employment contracts. It would be odd if the rest of the team could answer questions about resignation in this way but the Claimants could not. Even if Mr Brown’s and Ms Bhoma’s conduct amounted to a failure to have regard to a specific management instruction, in the particular context of these fast-moving events, it was very far from being a serious failure resulting in any damage or loss to Neon.
The Defendants specifically submit that Mr Brown’s conduct amounted to breaches of clause 4.4 of his contract of employment, in particular his duties to “be diligent, honest and ethical in the performance of your duties”; “conduct your personal and professional life to the highest standards and in a way which does not risk or adversely affect the standing and reputation of Marketform or the Group”; and/or “perform your services in a professional and competent manner and in cooperation with others”. In my judgment, nothing that Mr Brown did in this regard amounted to a breach of these provisions. He was not dishonest (albeit that Mr Louden might have been to a certain extent), his meeting with Mr Louden did not adversely affect the standing or reputation of the Defendants, and he performed his services as best he could, given the lack of work available and the hostile environment that existed once Neon had determined, without justification, that the Claimants were engaged in wrongdoing.
Conclusions
For the reasons set out above, it is my judgment and I declare that:
i) Neon was in repudiatory breach of each of the Claimants’ respective contracts of employment;
ii) The First and Second Claimants each accepted that repudiatory breach on 1 May 2018 and were thereby wrongfully dismissed;
iii) The First and Second Claimants accordingly no longer owe obligations under those contracts, including the PTRs, which fall away as a result of the Defendants’ repudiation.
By reason of the above, it follows that the Claimants are entitled to recover by way of damages:
i) The pay rises awarded on 7 March 2018, backdated to 1 January 2018;
ii) The discretionary bonuses declared for each of them on 7 March 2018;
iii) The appropriate share of correctly calculated PC that would have been payable as at December 2017 or March 2018.
The Defendants’ Counterclaim is dismissed in its entirety.
It only remains for me to thank all members of both legal teams for their diligence and hard work in enabling the Court to deal with this expedited trial in the time available.