27 Nov 2020
The EAT has held that an employee refusing to return to work following the end of her maternity leave amounted to her acceptance of a repudiatory breach. This meant that her claim for constructive dismissal could succeed.
Employees may claim constructive dismissal when they experience a hostile work environment and feel forced to resign. For this to be effective, they must demonstrate you acted in a way that breached the implied term of mutual trust between you. This must be a repudiatory or fundamental breach leading to the employee resigning. An example of this would be reducing their hours, or pay, without their consent.
In response to a breach of this nature, employees have a number of options. However, in order to go down the constructive dismissal route, there are a few steps they must follow. They need to demonstrate that they accept the breach and will therefore be taking further action, such as resigning. Then, they need to prove to the employment tribunal (ET) that the conduct of the organisation led to their resignation. Crucially, employees must show that they have accepted this breach in the eyes of the law in order for their claim to succeed.
Chemcem Scotland Ltd v Ure
This case concerned an employee who had previously gone on maternity leave and was due to return to her role. However, during this time, the organisation committed numerous actions due to a personal issue between her and a shareholder. The shareholder was her father. This included varying her pay without informing and consulting with her. The company switched her to a different payroll and failed to provide her statutory maternity pay (SMP) on time.
The employee refused to return to work. However, she did not communicate that she intended to resign from her position to the organisation. She instead went to the ET, citing constructive dismissal.
The tribunal upheld her claim. They found that the acts committed by the organisation had served to breach the mutual term of trust and confidence between her and the organisation. For the purpose of the law, her failure to return to work demonstrated she’d decided not to return due to these breaches. As a result, she accepted the breach and was free to pursue a claim of constructive dismissal.
The organisation appealed against this decision. They argued that the employee had failed to communicate her acceptance of the changes to her contract. As a result, it couldn’t be seen as a termination of the contact. Therefore, her claim should have been struck out.
The EAT dismissed the appeal, finding that the tribunal had reached their conclusions correctly.
They accepted that her failure to communicate may, normally, have meant her claim couldn’t succeed. However, they also addressed the circumstances surrounding her claim. It was clear that the employee had chosen not to return to work because of the way the organisation, and in particular her father, had treated her.
In this situation, the tribunal had correctly determined that this was the reason for her actions. Also, crucially, the organisation hadn’t challenged this ruling. They had therefore gone on to correctly conclude that, as a result of this, her non-appearance had amounted to her accepting the breach. This meant her constructive dismissal claim could succeed.
Note for employers
This is an interesting case. It suggests an employee can confirm their acceptance of a breach of contract just by not returning to work.
However, as noted by the EAT, this will be fact specific. Organisations should maintain regular contact with those on prolonged periods of leave. If they don’t return, you should establish why this is.
It’s also important to maintain mutual trust and confidence with your employees. If there are any changes to a contract that are deemed necessary, such as a reduction in pay, agreement should be reached with staff beforehand.
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