Thomson v Barnet Primary Care Trust

Where a contractual appeal procedure empowers an employer to replace a dismissal with a lesser outcome, a decision on appeal to reinstate the employee ordinarily revives the existing contract rather than offering a new contract for acceptance. Whether that is so depends on the proper construction of the contractual procedure and the appeal correspondence.

An employee does not permanently waive earlier breaches merely by remaining employed, pursuing objections to proposed return-to-work conditions, or receiving back pay paid unilaterally by the employer. Earlier breaches may be aggregated with later conduct under the last-straw doctrine, provided that the cumulative conduct is repudiatory and the employee resigns in response to it.

The Claimant, a district nurse employed since 1988, was summarily dismissed for capability in May 2008. On her contractual appeal, the Respondent revoked the dismissal, restored back pay and stated that her contract was reinstated. It also imposed a final written warning and required competency assessment, retraining and a return-to-work programme before her reintroduction to the workplace.

The Claimant resigned in December 2008, contending that the dismissal and the subsequent conditions cumulatively entitled her to treat the contract as repudiated. The Employment Tribunal held that she had accepted a new contract, or alternatively waived the earlier breaches, and dismissed her claims. It refused a review. The central issue on appeal was whether the appeal outcome revived the existing contract and whether the earlier breaches could support a last-straw constructive-dismissal claim.

1. Appeal allowed. The Claimant was constructively dismissed. The issues of unfairness, wrongful dismissal and remedy were remitted to the Employment Tribunal.

2. On the proper construction of the appeal correspondence, the Respondent reinstated the Claimant as an employee and set aside the May dismissal. It distinguished that status from her later physical return to a particular role in the workplace, which was made conditional on assessment and retraining. The Employment Tribunal therefore erred in holding that the back-pay payment created a new contract.

3. The contractual appeal process permitted the Respondent to replace dismissal with a lesser step. Applying Roberts v West Coast Trains Ltd [2005] ICR 254, such a decision revives the existing employment contract retrospectively rather than requiring the employee to accept a fresh offer. The Claimant consequently retained sufficient continuous employment under the Employment Rights Act 1996.

4. The Claimant had not waived the pre-dismissal breaches. The Respondent had paid back pay and resumed wages without any unequivocal acceptance by her of the proposed conditions. Her union continued to challenge those conditions. The earlier breaches could therefore be considered with subsequent matters as a cumulative case of repudiatory conduct.

5. Under Omilaju v London Borough of Waltham Forest [2005] IRLR 35, individual events need not themselves be repudiatory, but their aggregate must be. The Tribunal had failed to address the pleaded contention that the onerous return-to-work programme was the last straw. The chronology established that the Claimant resigned in response to that programme and the preceding course of conduct.

6. The EAT determined constructive dismissal itself. Whether the dismissal was unfair, whether it was wrongful, and the effect of the retraining evidence on compensation were matters for the Employment Tribunal, including under section 98(4).

• Employment Appeal Tribunal: Allowed the Claimant's appeal and held that she had been constructively dismissed.
• London Central Employment Tribunal: Dismissed the claims of unfair and wrongful dismissal in reasons sent on 16 March 2011. It held that the Claimant had accepted a new contractual basis, or alternatively waived earlier breaches. A review was refused.