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Employment Law Case Update: Constructive Unfair Dismissal

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Supporting all of our employees and treating them fairly and consistently forms the foundation of any employer-employee relationship, and when this fails it could lead to a tribunal claim.  Our Employment Law team today review the case of Mr W Vaughan v Talbot Underwriting Services Ltd and the strain caused by failing to support and train an employee in need.

For the first four years of Mr Vaughan’s employment as an accounts assistant at Talbot Underwriting Services Ltd, no formal performance issues were raised. But in August 2017, one of his colleagues went on long term sick leave, leaving Mr Vaughan to take on additional work for several months. He was inexperienced in dealing with some of this and had not been given training to help him carry out the work.

In February 2019, Mr Vaughan was called to a table in the middle of the open plan floor where he was berated” in front of colleagues by a senior manager, known here as ‘B’.  As a result, he raised a grievance stating that while B may have had good reason to raise issues with his work, the manner and tone used by B was extremely shocking and belittling”.

Following this incident, Mr Vaughan was signed off work for some weeks with anxiety, tension and poor sleep.  On returning to work he noticed the attitudes of some senior managers towards him had changed. He felt they ignored him when previously they would have acknowledged him. 

Mr Vaughan’s grievance was upheld. The outcome stated that B had spoken to Mr Vaughan in a bullying manner. As a result he was given a new line manager while B underwent a disciplinary process.  Having been found to have committed an act of harassment (intimidation and bullying)” which may have been a systemic behaviour”, B was given a final written warning, and details of courses to assist her at a difficult time,.

In following months the company became concerned about Mr Vaughan’s performance and his new line manager sought to address the concerns informally with him. There was no discussion about why his standards might have dropped, such as whether this was work-related, as a result of the bullying and its aftermath, or a health issue.

In August 2019, Mr Vaughan began conversations with HR and some of the senior managers about resigning, citing the treatment he’d received after his grievance, that he felt that he was being set up to fail and that he did not want to go through a capability process. However, one of the senior managers encouraged him to remain, stating that he would be given additional training.  As a result Mr Vaughan believed the company would not start a formal capability process and decided not to resign - but a week later he received a letter inviting him to a formal capability hearing.

On 30 August 2019, Mr Vaughan met with the HR Manager and resigned, saying he didn’t want to put himself through the capability procedure and felt he needed a fresh start.

Mr Vaughan issued a claim in the ET alleging constructive dismissal. He argued that his employer talked him out of resigning in order to issue some form of written warning in time to prevent him pursuing a tribunal claim. He also argued that no training had been provided despite assurances that it would, and that formal capability proceedings were commenced after he was talked out of resigning with the promise the company would not start a formal process.

Mr Vaughan succeeded in his constructive unfair dismissal claim. The tribunal noted that the company failed to check the employee’s wellbeing or offer him support even after he experienced significant incidents of bullying and when he returned to work after a period of work related sickness absence.  Support was, however, offered to B. This lack of support and the coldness” he experienced from senior managers on his return contributed to Mr Vaughan’s view that, following his grievance, he was no longer wanted.  The tribunal held that this did seriously damage the relationship of confidence and trust between the parties.

The ET also found that subjecting Mr Vaughan to a formal capability process amounted to a breach of trust and confidence.  The ET commented that it was unusual to make such a finding where there was evidence of some underperformance. However, in the circumstances the employee was persuaded not to resign on the basis that he would receive assistance and training and he was reassured that the company wanted him to remain in post. Yet very shortly after a decision was made to put him through the capability process – the very thing he wanted to avoid. The tribunal held that the employee resigned as a consequence of the decision to impose a formal process, coupled with the view that his employer wanted him out. Therefore the company’s conduct was likely to destroy or seriously damage the trust and confidence in the employment relationship. 

This case highlights the importance of handling any grievance process carefully, as well as its aftermath, and remembering to offer support to all parties where appropriate. Managers should be made aware that employees who have raised concerns or grievances should not be treated unfavourably and processes should be put in place to ensure that employees are adequately supported and treated fairly following the conclusion of a grievance process. 

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.