Employment Update: Statutory grievance/constructive dismissal

The ‘trigger’ for a decision to claim constructive dismissal need not be the subject of a grievance.

In the recent case of Thornton Print v Morton the claimant was joint managing director of the employer company. After a disagreement over how news of impending redundancies should be broken to workers on the shop floor, he was instructed by the company chairman to take two weeks off and stay away from the factory. The chairman invited him to resign and take up a post with another subsidiary company in the same group. He refused. The chairman said that he would put his proposals to him in writing. Ten days later he received the letter which alleged that complaints had been made about him and suggesting that he should attend a disciplinary hearing chaired by a junior executive from another group company.

He then wrote a grievance letter, refusing to attend the meeting and making it clear that he regarded his employment as terminated by the chairman’s refusal to let him return to work unless he took on a different post at another company and at a lower salary.

In the EAT, the employer argued that, as the claimant had waited for the chairman’s letter before deciding to resign, that letter was the ‘last straw’ which had driven him to do so. However, he has not raised that issue in his grievance letter. This meant that he had not followed the statutory grievance procedure and so his tribunal claim could not proceed.

The EAT disagreed. The chairman’s letter had not been the ‘last straw’. It was the ‘trigger’ for his decision to accept the earlier repudiatory breach of contract as terminating his employment. There was no need for unnecessary formality in the statutory grievance procedure. It was sufficient that the subject of the grievance was the earlier breach. His claim for constructive dismissal could proceed.

Points to note –

The statutory grievance procedure is slated for repeal from April 2009. However, this case is a reminder that a series of events taken together may amount to a repudiatory breach of contract by the employer entitling an employee to resign and claim constructive dismissal.
An employee must resign promptly in response to a repudiatory breach by the employer if he or she wishes to claim constructive dismissal. In this case, the outcome might have been different if the chairman had written an apologetic or conciliatory letter making an offer which remedied the earlier breach. Having waited for the letter, the employee might then be in no position to claim constructive dismissal if he then chose to resign.