Employment Appeal Tribunal
The subjective intention of an employer in a constructive dismissal case was not determinative of whether it had breached the implied term of trust and confidence. The principle set out in Tullett Prebon Plc v BGC Brokers LP  EWCA Civ 131,  I.R.L.R. 420, that all circumstances should have been taken into account in so far as they were relevant to an objective assessment of the contract-breaker's intention, did not depart from the traditional test set out in Woods v WM Car Services (Peterborough) Ltd  I.C.R. 666; it reinforced it.
The appellant dental practice (L) appealed against an employment tribunal's decision that it had constructively dismissed the respondent practice manager (R).
R had managed L's dental practice and was accused of not recording a nurse's sick days. She was suspended pending a disciplinary hearing to which she wanted to bring a dentist but L refused to allow the dentist to enter the hearing as it felt he would support R. She was told that she would not be paid if she did not attend a rescheduled hearing. She resigned following a period of sick-leave and claimed constructive dismissal. The tribunal found that L had breached the implied term of trust and confidence by its poor handling of the disciplinary process and noted that R had been promoted to practice manager without proper training or a system for recording staff absences. R had informally told one of L's directors that she had felt it unnecessary to record sick-days as she had understood the nurse to be entitled to sick-pay at the normal pay-rate. The tribunal held that a reasonable employer would have conducted an investigatory interview and realised that R, rather than being guilty of misconduct, had needed support and training. The tribunal also held that L had unreasonably refused to allow the dentist to accompany R, leaving her to attend the hearing alone and under duress, and had oppressively told her that she would not be paid if she did not attend the next hearing.
L contended that (1) Tullett Prebon Plc v BGC Brokers LP  EWCA Civ 131,  I.R.L.R. 420 had changed the law and required the tribunal to make a specific finding as to L's subjective intention in acting in the manner which was said to have amounted to a breach of trust and confidence; (2) the tribunal's finding was perverse as L's conduct could not have amounted to a fundamental breach of contract.
HELD: (1) It had been long established that an employer's intention to repudiate a contract was determined by reasonably and sensibly examining its conduct as a whole to see if it was such that an employee could not have been expected to put up with it, Woods v WM Car Services (Peterborough) Ltd  I.C.R. 666 followed. The test was not whether an employee had subjectively lost confidence in an employer but whether, objectively, the employer's conduct was likely to destroy or seriously damage the trust and confidence that the employee was entitled to have in it, Malik v Bank of Credit and Commerce International SA (In Liquidation)  A.C. 20 and Meikle v Nottinghamshire CC  EWCA Civ 859,  4 All E.R. 97 followed. The principle set out in Tullett Prebon was that all the circumstances should have been taken into account in so far as they had a bearing on an objective assessment of the contract-breaker's intention: that was no different from the traditional test set out in Woods, Tullett Prebon considered and Woods followed. The employer's subjective intention was irrelevant, and the tribunal in the instant case was not required to make a factual finding as to L's actual intention (see paras 20-21, 23-26 of judgment). (2) An investigatory interview was not required in every case but R's integrity had been challenged without giving her a proper opportunity to explain her position before disciplinary proceedings were instituted. The tribunal's factual conclusion that such an interview was required and had not occurred was not perverse. Nor was it unreasonable for the tribunal to conclude that the language used in the letter inviting R to the disciplinary hearing was disproportionate and intimidating given that she had been a longstanding employee with no previous disciplinary problems. It could not be said that no reasonable tribunal would have found it unreasonable of L to deny R's request to be accompanied by the dentist nor that it had been disproportionate for L to threaten not to pay R if she did not attend the rescheduled hearing. The high threshold for perversity had not been met as it had been plainly open to the tribunal to regard L's conduct as amounting to a repudiatory breach (see paras 32, 34, 37, 39, 40).
For the appellant: Non-counsel representative
For the respondent: David Cunnington
 IRLR 8 :  ICR 94
William Meade (Senior Clerk)