McBride v Falkirk Football & Athletic Club

An employer cannot unilaterally remove a fundamental aspect of an employee’s contractual role unless the contract permits the change or the employee agrees to it. A term may be implied only where the surrounding circumstances establish that the parties actually intended it to form part of their contract. The implied term must be sufficiently precise and cannot contradict an express term.

The duty of trust and confidence is assessed objectively. Industry custom or an allegedly autocratic management style cannot justify conduct likely seriously to damage that relationship. Imposing a substantial change without prior notice, consultation or discussion may constitute both a fundamental contractual breach and a breach of trust and confidence. Resignation may be treated as caused by the employer’s conduct where it responds to the substance of the change and the manner in which it was imposed.

The Claimant was appointed manager/head coach of the Respondent’s under-19 team and was told that he would be in control of it without interference. After the Respondent appointed an Academy Director, it instructed that director to select the team, thereby affecting related responsibilities including set pieces, team talks and formation. The Claimant resigned and claimed unfair constructive dismissal.

An Employment Tribunal dismissed the claim. It implied a contractual term that the Academy Director would assume final responsibility for selection once properly fulfilling the role. It also held that the failure to consult did not breach trust and confidence because autocratic management was said to be normal in football, and that the resignation was caused only by the loss of selection responsibility. The central issues were whether the term could properly be implied, whether the change was fundamental, and whether the Claimant resigned in response to the Respondent’s conduct.

1. Appeal allowed. The Employment Appeal Tribunal substituted a finding that the Claimant had been unfairly dismissed and remitted the case to a freshly constituted Employment Tribunal to determine remedy.
2. The Tribunal had determined the case on an implied-term argument which had not been raised in the response and had not been put to the Claimant in cross-examination. This created a fair-notice issue. In accordance with Netintelligence v McNaught, where a tribunal accepts evidence on an unnotified issue despite the absence of cross-examination, clear justification is required.
3. The express contractual term was that the Claimant would control the under-19 team without interference. There was no proper basis for implying a term that he would relinquish selection responsibility when an Academy Director was appointed. The proposed term was imprecise, was not necessary or obvious, conflicted with the express term, and was unsupported by usage, custom or any previous course of dealing. The Respondent could have sought a subsequent variation, but had not done so.
4. The transfer of team selection, together with associated responsibility for set pieces, team talks and formation, was a substantial and fundamental change. The circumstances were comparable to those in Keegan v Newcastle United Football Club, where removal of a manager’s final authority was treated as undermining his position.
5. The Respondent also breached the mutual term of trust and confidence. The duty is objective and cannot be assessed by reference to allegedly normal industry practice. Applying Malik v Bank of Credit and Commerce International SA and Morrow v Safeway Stores, imposing the change without notice, consultation or discussion was conduct likely seriously to damage the employment relationship.
6. The findings showed that the resignation responded both to the removal of autonomy and to the manner in which the decision was imposed. The Claimant therefore resigned in response to the repudiatory breaches.

• Employment Appeal Tribunal: allowed the appeal against the Employment Tribunal’s judgment registered on 2 August 2010, substituted a finding of unfair dismissal, and remitted remedy to a freshly constituted Employment Tribunal.