Frith Accountants Ltd v Law

For contributory-fault deductions, conduct must be culpable or blameworthy; mere unreasonable conduct or conduct attracting criticism is insufficient. Under section 123(6) of the Employment Rights Act 1996, the conduct must also have caused or contributed to the dismissal to some extent. The causation question is one of fact, assessed robustly, and is rarely disturbed on appeal. A constructive dismissal will seldom involve employee contribution where the dismissal results from the employer’s repudiatory breach, particularly breach of trust and confidence without reasonable or proper cause. Section 122(2) has no separate causation requirement, but the tribunal must expressly decide whether a deduction from the basic award is just and equitable. A percentage assessment of future dismissal is a fact-sensitive evaluative judgment falling within a wide permissible range.

The claimant had earlier succeeded in establishing constructive unfair dismissal under section 95(1)(c) of the Employment Rights Act 1996, after her employer discussed concerns about her performance and health with her son rather than with her.

At the remedy hearing, the Employment Tribunal declined to reduce the compensatory award for contributory conduct, did not expressly determine whether the basic award should be reduced, and assessed the chance of a later dismissal or resignation at 40 per cent. The employer appealed on those three issues.

1. Ground A dismissed. Conduct relied on for contributory fault under sections 122(2) and 123(6) of the Employment Rights Act 1996 must be culpable or blameworthy. Under section 123(6), it must additionally have caused or contributed to the dismissal to some extent. The words any extent are broad, but they remain words of causation.
2. Constructive dismissal is ordinarily caused by the employer’s repudiatory breach, not by the employee’s conduct. Where the breach is of the implied term of trust and confidence, the absence of reasonable or proper cause is inherent in the breach. Employee conduct may nevertheless be relevant to compensation because sections 122 and 123 apply to any dismissal. The Tribunal was entitled to find that the claimant’s alleged failure to accept criticism had not caused or contributed to the dismissal. Causation is primarily a question of fact, approached robustly, and could be overturned only for legal error, failure to decide the issue, or perversity.
3. Ground B allowed. Section 122(2) does not require causation. The Tribunal therefore had to consider the conduct relied on and decide whether it was just and equitable to reduce the basic award. Its reasoning addressed causation only and failed to determine that separate statutory question. By agreement, £2,150 was substituted for the basic award.
4. Ground C dismissed. The assessment of the chance of future dismissal necessarily involves speculation and lies within a very wide range of reasonable judgment. The 40 per cent assessment was not manifestly outside that range and could not be challenged on appeal.

• Employment Tribunal, London (South): the claimant was found constructively dismissed on 9 August 2012. Remedy reasons were given on 5 September 2013. The Tribunal made no compensatory deduction for contribution, did not expressly determine the basic-award deduction issue, and assessed the future-dismissal chance at 40 per cent.
• Employment Appeal Tribunal: Ground A and Ground C dismissed. Ground B allowed. The basic award was replaced by agreement with £2,150.