Southern v. Wadacre Ltd (t/a Wadacre Farm Day Nursery)

An Employment Tribunal determining a constructive dismissal claim must identify and decide whether the employer committed the alleged fundamental breach, whether the employee affirmed the contract, and which matters caused the resignation. Mere continuation of employment does not necessarily amount to affirmation. Delay is relevant, but must be assessed with all the circumstances, including any protest, reservation of rights and the employee’s illness. Written reasons must explain the findings and reasoning sufficiently to show why the parties won or lost and whether the law was correctly applied. Where the Tribunal has failed substantially to find primary facts on disputed issues, the Employment Appeal Tribunal should remit rather than substitute its own decision.

The Claimant appealed against the Employment Tribunal’s dismissal of her claim for constructive unfair dismissal. She alleged several contractual breaches, including changes to her hours, treatment in a disciplinary process, demotion, conduct said to damage trust and confidence, and being invited to a grievance meeting conducted by the person about whom she had complained.

The Tribunal made few primary findings on those allegations. It concluded that any earlier breach had been accepted by the Claimant through remaining in employment, and that the proposed grievance arrangements did not form part of her reason for resigning. The central issues were whether the Tribunal had given adequate reasons and whether the Employment Appeal Tribunal could substitute its own decision.

1. Appeal allowed. The Tribunal had failed to determine the key issue whether the alleged matters, individually or cumulatively, amounted to a fundamental breach of contract. It also failed to explain why that issue had not been determined. This breached the requirements for written reasons under Rule 30(6) of the Employment Tribunals (Constitution & Rules etc) Regs 2004 and the principles stated in Meek v City of Birmingham District Council [1987] IRLR 250.
2. The relevant question was whether the Claimant had expressly or implicitly affirmed the contract, not whether she had simply accepted the breach. Under W E Cox Toner (International) Ltd v Crook [1981] IRLR 443, mere delay does not itself amount to affirmation, although prolonged delay may provide evidence of implied affirmation. The circumstances must be assessed, including the nature of the breach, any protest or reservation, and the employee’s conduct. Waltons and Morse v Dorrington [1997] IRLR 488 was relevant to that contextual assessment.
3. The fact that an employee is absent through illness when alleged to have affirmed the contract is a relevant circumstance: Bashir v Brillo Manufacturing Company Limited, paragraph 16. The Tribunal’s omission of the Claimant’s immediate absence through stress and anxiety suggested that it may have treated remaining employed as necessarily affirming the contract. Its conclusion was wholly unreasoned and could not stand.
4. The Tribunal also failed to explain why it rejected the Claimant’s evidence that the proposed grievance meeting, to be conducted by the person against whom she complained, formed part of her reason for resigning. That was a material issue raised in the pleadings and evidence.
5. The Tribunal’s power to substitute its own decision was limited by the appellate jurisdiction under section 21(1) of the Employment Tribunals Act 1996. Given the wholesale absence of primary findings on disputed factual issues, substitution was unsafe. The matter was remitted to a different Employment Tribunal.

• Employment Appeal Tribunal: Allowed the appeal against the Employment Tribunal’s judgment dated 15 June 2009. The claim was remitted to a different Employment Tribunal for determination.