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The 'Final Straw' and Constructive Dismissal

It is an implied term of any contract of employment that an employer should not act in a way that is likely to destroy or seriously damage the trust and confidence which an employee can expect from them.

A serious breach of an implied contractual term or the 'final straw' in a series of less serious actions which cumulatively undermine an employee's trust and confidence in their employer will amount to a repudiatory breach of the employment contract and will normally justify the employee in terminating the contract and claiming constructive dismissal. The final straw may be a relatively minor act but it must contribute, however slightly, to the breach of the implied term of trust and confidence.

In a recent case on this topic (Kaur v Leeds Teaching Hospitals NHS Trust), an NHS trust defeated a nurse's constructive unfair dismissal claim on the basis that the procedures it had followed during disciplinary proceedings were unarguably reasonable.

The nurse claimed that she had been the subject of unjustified complaints in respect of her performance and that she had been bullied by a number of her colleagues. Following an altercation between her and a healthcare assistant, she went off sick and raised a Dignity at Work complaint against the other woman. The trust instituted disciplinary proceedings in respect of them both and a hearing was held which also dealt with the nurse's complaint.

The panel found both women guilty of inappropriate behaviour in that they had shouted at one another in close proximity to an area in which patients were being treated. Both were issued with final written warnings. The nurse's appeal against that decision was later dismissed and she resigned the following day.

She subsequently brought a claim of constructive unfair dismissal on the ground that the rejection of her appeal was the last straw in a series of actions that had undermined her trust and confidence in her employer. Her claim was rejected at an early stage by an Employment Tribunal (ET) on the basis that it had no reasonable prospect of success. She had little chance of establishing that the trust did not have reasonable ground for instituting the disciplinary proceedings. In the light of the evidence, she had clearly raised her voice within patients' hearing and the decision to issue her with a final warning was justified. Her appeal against that ruling was later dismissed by the Employment Appeal Tribunal.

In rejecting her challenge to the latter ruling, the Court of Appeal found that the procedure followed by the trust could not be faulted. Such a process, properly followed, or its outcome, could not constitute a repudiatory breach of contract or contribute to a series of acts which cumulatively constitute such a breach. Although the nurse believed the outcome of the process to be wrong, the test was an objective one and a fair disciplinary process could not be viewed as having destroyed or seriously damaged the relationship of trust and confidence between employer and employee.

In reaching its decision, the Court advised of the five questions an ET needs to consider in such cases. These are:

  1. What was the most recent act (or omission) on the part of the employer which the employee says caused or triggered their resignation?
  2. Has the employee 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 of a course of conduct comprising several acts and omissions which, viewed cumulatively, amounted to a repudiatory breach of the employee's contract? If it was, there is no need for any separate consideration of a possible previous affirmation.
  5. Did the employee resign in response (or partly in response) to that breach?
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