Nicholson (nee Woodhouse) v Hazel House Nursing Home Ltd

An Employment Tribunal considering constructive dismissal must first decide whether the employer committed a repudiatory breach of contract. It must keep that contractual question distinct from whether conduct was discriminatory.

A wrongly rejected grievance may be a repudiatory breach, or the non-trivial last straw in a cumulative course of conduct. A grievance appeal cannot cure an earlier repudiation, and an employee need not identify the grievance outcome in the resignation letter.

Where the Tribunal’s findings and undisputed facts admit only one lawful result, the Employment Appeal Tribunal may substitute that result rather than remit liability.

The Claimant, a care assistant, resigned after her employer rejected her grievance. The grievance concerned, among other matters, a pregnancy-related reduction in shifts which the Employment Tribunal had found discriminatory, and persistent underpayment.

The Employment Tribunal dismissed the constructive dismissal and unfair dismissal claims. It treated the grievance appeal, the time since the discriminatory reduction in shifts, and the contents of the resignation letter as material against constructive dismissal.

On appeal, the central issue was whether the Employment Tribunal had erred in law in its approach to constructive unfair dismissal.

1. Appeal allowed. The Employment Tribunal made material errors of law in dismissing the constructive dismissal claim.

2. The correct first question was whether the employer’s conduct amounted to a repudiatory breach. The Tribunal instead dealt first with discrimination questions and thereby confused the contractual issue with the question whether the grievance outcome itself was pregnancy discrimination.

3. The Tribunal failed to assess the significance of its finding that the reduction in shifts was pregnancy discrimination, the employer’s wrongful rejection of the resulting grievance, and the conceded history of underpayment. The grievance was significant because the discriminatory reduction had substantially reduced the Claimant’s income and prevented her qualifying for statutory maternity pay.

4. The Tribunal also erred in treating the uncompleted grievance appeal as relevant. A repudiation cannot be cured by an appeal, particularly where the relevant appeal events occurred after the contract had ended. It further erred by failing to ask whether the grievance outcome was itself repudiatory or the last straw in a cumulative breach, and by treating the absence of any reference to the grievance in the resignation letter as material.

5. On the Tribunal’s findings and undisputed facts, no properly directed Tribunal could conclude that the employer had not repudiated the contract, or that the Claimant did not resign in response. The Employment Appeal Tribunal therefore substituted findings of constructive dismissal and unfair dismissal, and remitted the case to the Employment Tribunal for remedy only.

• Employment Appeal Tribunal: Allowed the Claimant’s appeal, substituted findings of constructive dismissal and unfair dismissal, and remitted remedy to the Employment Tribunal.

• Employment Tribunal, Manchester: Decision sent to the parties on 2 March 2015. It found that the reduction in shifts was pregnancy discrimination but dismissed the constructive dismissal and unfair dismissal claims.