Case Name: Philip Stanford v Philip King Electrical Limited T/A King Communications (UD 1074/2009)

Legislation: Unfair Dismissals Acts, 1997 TO 2007 (the “Acts”)

Jurisdictions/ Subject Matter: Constructive Dismissal


Facts

The Claimant commenced employment with the respondent company in 2007. In September 2008 he began working in the Sligo store. The claimant often worked alone in the store and would close the shop to take a bathroom break. The MD’s wife worked in the company’s headquarters and was responsible for telesales and general administration. There was a disagreement between the Claimant and the MD’s wife in October 2008 when she tried to ring the shop and got no answer as the Claimant had closed up for a bathroom break. The Claimant alleges that the MD’s wife called him a name and told him he had no authority to close the shop.

The following day (29 October 2008), the Area Manager asked the Claimant to attend a meeting with the MD. In this meeting, the Claimant was asked to move employment and become part of the telesales team in Killeshandra. The Claimant told the Tribunal that he did not believe he had a choice in the matter. The MD for the Respondent company said they believed the Claimant had accepted the position.

On the 31 October 2008, the Claimant emailed the MD and told him he would not accept the position in Killeshandra. The MD informed the Claimant that if he did not take up the position in Killeshandra, he no longer had a job with the company.

The Claimant and the MD for the Respondent company met on the 26 November 2008 to discuss the situation. The Claimant had not worked for the company in the interim but the company continued to pay his wages. The MD arrived at the meeting with the Area Manager. The Claimant refused to participate in the meeting in the presence of the Area Manager and walked out.

The MD emailed the Claimant on the 27 November 2008 expressing his shock at the Claimant’s behaviour in the meeting and requiring him to attend work the following morning in the Carrick-on-Shannon store. The Claimant did not read this email until the 28 November 2008 and therefore did not show up for work as requested.

The MD emailed the Claimant on the evening of the 28 November 2008 to initiate disciplinary proceedings against him for his failure to show up for work that day.

The Claimant emailed his letter of resignation to the MD on 1 December 2008 and confirmed his date of dismissal as 5 December 2008 to the Tribunal.

The Claimant told the Tribunal that he accepted that the MD had confirmed that there was work available in the Carrick-on-Shannon or Sligo store following his refusal to accept the telesales position but did not believe this offer was genuine as his name was never put on the roster.

The Claimant told the Tribunal that he decided not to engage in the disciplinary process and instead resigned after taking legal advice.


Determination

As dismissal was in dispute, it fell to the Claimant to prove his case on the balance of probabilities that the Respondent’s conduct was such that it was reasonable for him to resign.

The Tribunal accepted that the MD apologised to the Claimant and admitted that telling him that if he did not take up the position in Killeshandra, he no longer had a job with the company was an overreaction and withdrew this threat.

The Tribunal agreed that the initial actions of the MD were not best practice and that in assuming the Claimant’s consent to move to Killeshandra, he acted wrongly and should not have threatened the Claimant with dismissal.

However, the Tribunal took the view that the Respondent acted reasonably thereafter by attempting to resolve the situation and offering the claimant the option to return to work in Sligo or Carrick-on-Shannon.

The Tribunal did not feel that the Claimant had shown that it was reasonable for him to resign given the circumstances. Therefore, the claim was dismissed under the Unfair Dismissals Acts, 1977 to 2007.


Legal Review

Constructive dismissal is defined in Section 2 of the 1977 Act and arises where an employee terminates their contract of employment, with or without prior notice, due to the conduct of an employer.

If no notice is given, the employer’s conduct must be so bad that it would be considered reasonable for the employee to terminate their contract without notice.

The equivalent UK provision is far more restrictive and does not provide that it might be “reasonable” for an employee to terminate their contract of employment, therefore UK cases tend treat constructive dismissal more like a fundamental breach at common law.

Where an employee is dismissed, in certain circumstances they can bring a claim for unfair dismissal and the onus will be on the employer to show that the dismissal was fair. In other words, dismissal is presumed unfair unless the employer can show substantial grounds to justify it. In contrast, where an employee terminates their own contract and claims constructive dismissal under the Acts, the onus falls on the employee to prove their resignation was justified.

Irish cases on constructive dismissal tend to deal with a wide range of conduct and claims have arisen on foot of employers reducing employees pay; claims of unsuitable working environment; change in job function; change of job location etc.

The EAT will have regard to the employee’s conduct prior to resignation and in considering whether it was reasonable will look at whether:

- The employee brought their concerns to the employer’s attention and whether they utilised and exhausted internal grievance procedures;
- The employer was given an adequate opportunity by the employee to deal with their concerns;
- There was a connection between the conduct complained of and the employee’s resignation.

From an employer’s point of view, the employer’s conduct in any investigation and follow up on complaints will be crucial in determining whether the employer acted reasonably towards the employee. In assessing an employer’s conduct in this respect, the EAT have considered the following:

- An employer’s words, actions and responses;
- The work environment created by the employer;
- Failure by an employer to comply with a fundamental term of the contract of employment;
- Failure by an employer to adequately respond to concerns or grievances raised by an employee;
- Failure to exhaust their own procedures for dealing with an employee’s concerns or grievances;
- Failure to encourage an employee to have recourse to such procedures;
- Whether there was a genuine attempt made by the employer to deal with the concerns of the employee.

It has become common for employees to seek to create an opportunity to resign and claim constructive dismissal. It is important that employers are alive to the possibility of employees “setting up” or engineering claims. Often the employee is waiting for an opportunity to claim that the employer will not deal with their complaint, or to claim that the employer is unreasonably insisting on some element of a procedure which objectively speaking is unfair (such as potential bias on the part of any person hearing an internal grievance). Often the employee will be advised to take advantage of the opportunity presented and resign before the employer can mend its hand. Sometimes, where the employer does mend its hand, the employee simply waits for another opportunity to arise, or seeks to create another opportunity to resign.

As with any claim under the Unfair Dismissals legislation, subject to certain limited exceptions, an employee must have 12 months' continuous service to bring a claim against an employer. The claim must be made within 6 months of the date of the termination of employment (extendable to 12 months in cases where exceptional circumstances have prevented the lodgement of the claim within 6 months).