Frenkel Topping Ltd v King

An employee establishes constructive dismissal where the employer commits a repudiatory breach and the employee resigns at least partly in response to it, without affirming the contract. The breach need not be the principal, effective, or but-for cause of resignation.

The implied term of trust and confidence sets a demanding objective standard. Unreasonable conduct alone does not suffice; the conduct must be likely seriously to damage the employment relationship. Repeated, unjustified and public criticism by senior management, motivated by protected disclosures and accompanied by a threat affecting the employee’s outside work, was necessarily repudiatory in its context.

The Claimant, a solicitor employed by the Respondent, resigned after making protected disclosures and raising concerns about the employer’s conduct. The Employment Tribunal held that she had suffered detriment through unfair and inappropriate criticism at two meetings on 17 February 2014. It rejected her claim that the principal reason for dismissal was protected disclosure under section 103A, but upheld her ordinary unfair-dismissal claim on the basis of constructive dismissal.

The Respondent appealed. It challenged the Tribunal’s reasoning on findings concerning referral fees, treatment of a colleague, and an outdated contractual whistleblowing policy. It also contended that the matters found to be contractual breaches were not the principal reason for resignation.

The central issue was whether the uncontested events of 17 February 2014 could sustain constructive dismissal where they were only part of the reasons for resignation.

1. Appeal dismissed. Although parts of the Tribunal’s reasoning were legally insufficient, its unchallenged findings about the Respondent’s conduct on 17 February 2014 independently sustained the finding of constructive dismissal.

2. For constructive dismissal, an employee must show a repudiatory breach, resignation at least partly in response to that breach, and no affirmation. Applying Wright v North Ayrshire Council [2014] IRLR 4, the relevant breach need not be the principal, effective, or but-for cause of resignation. It is sufficient that it was a reason or part of the reason.

3. The implied term of trust and confidence requires conduct which, without reasonable and proper cause, is calculated or likely seriously to damage the relationship. The standard is stringent: unreasonable conduct is insufficient. However, the findings here showed repeated unjustified criticism by the Managing Director and Finance Director, including public humiliation, because the Claimant had made protected disclosures. She was also threatened with increased hours that would prevent her voluntary work. In that context, no reasonable court could regard the conduct as other than repudiatory.

4. The Tribunal gave inadequate reasons for its finding that the Respondent had paid unlawful referral fees. It also inadequately explained why requiring a colleague to apologise amounted to a breach of trust and confidence owed to the Claimant. Its conclusion that the outdated contractual whistleblowing policy was itself a repudiatory breach was unsupported by adequate reasoning. Those errors were immaterial because the 17 February breach was sufficient and had contributed to the resignation.

• Employment Appeal Tribunal: dismissed the employer’s appeal and upheld the conclusion that the Claimant had been constructively and unfairly dismissed.
• Employment Tribunal, Manchester: in reasons sent on 14 October 2014, found that the Claimant had made protected disclosures and suffered detriment, rejected automatic unfair dismissal under section 103A of the Employment Rights Act 1996, but upheld ordinary unfair dismissal.