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Employment Law Case Update: Constructive Dismissal and Harassment

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Our Employment Law team today reviews one of the rare occasions the Employment Tribunal (ET) departed from previous case law and ruled that a constructive dismissal may, in some cases, amount to an act of harassment; the case of Ms M Driscoll v 1) V&P Global Limited 2) Mr F Varela 2021.

Ms Driscoll began working for the company in April 2019 as an executive assistant. She resigned four months after she was hired, claiming that the Chief Executive of the company, Mr Varela, had made various comments which amounted to harassment based on sex, race, and disability. Ms Driscoll filed a claim against the company for constructive dismissal and harassment. She alleged that the harassment took the form of the comments made by Mr Varela which culminated in her resignation. She was unable to claim unfair dismissal because she had less than two years’ service.

The ET struck out Ms Driscoll’s claim of constructive dismissal. In doing so it relied on the case of Timothy James Consulting Ltd v Wilton [2015] which ruled that “as a matter of law, a constructive dismissal could not amount to an act of harassment”.

Ms Driscoll appealed the ET’s decision, arguing that Wilton should not be followed because it is inconsistent with anti-discrimination EU Directives.

The Employment Appeal Tribunal (EAT) upheld Ms Driscoll’s appeal, concluding that “a constructive dismissal is, in principle, capable of constituting an act of harassment, within the meaning of section 26 of the Equality Act 2010”. In reaching its decision the EAT reasoned that Wilton had been decided without the benefit of EU Directives and relevant case law and so was manifestly wrong”. Justice Ellenbogen noted that the relevant EU Directives prohibit harassment in relation to dismissals and that ‘dismissal’ is to be widely construed. She wrote that there was no principled basis upon which… the word dismissal should be taken to exclude constructive dismissal”. The EAT was therefore satisfied that as a matter of law, where an employee… resigns in response to repudiatory conduct which constitutes or includes unlawful harassment, his or her constructive dismissal is itself capable of constituting unwanted conduct’ and, hence, an act of harassment, contrary to [the Equality Act 2010]”.

The EAT consequently reinstated Ms Drisolls claim of harassment and the claim was remitted back to the ET to be decided.

This case establishes that a constructive dismissal can constitute “unwanted conduct” amounting to harassment. This is significant for employers for two reasons:

  • First, an employee with less than two years’ service may still bring a claim if treatment amounting to harassment caused them to resign.
  • Second, where a constructive dismissal claim is brought as a harassment claim, the employee’s compensation may be uncapped. 

This is an EAT decision and so will be followed by Employment Tribunals in the future.

If you have any questions regarding this article, you can call our Employment team today on 023 8071 7717 or email employment@warnergoodman.co.uk.

This was previously part of our weekly Employment Law Newsletter. If you would like to subscribe, please email us at events@warnergoodman.co.uk or just fill in our subscription form.

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.