Retirement Security Ltd v Wilson

A constructive dismissal is not automatically unfair. The employer must prove both the reason for the deemed dismissal and that it is a potentially fair reason under Employment Rights Act 1996, section 98. An Employment Tribunal is not required to construct a possible fair reason where the employer has not advanced one.

In a constructive dismissal case, the conduct entitling the employee to terminate the contract must itself be capable of amounting to a fair reason. The proper conduct of an investigation is fact-sensitive. However, an investigatory process conducted without reasonable and proper cause may fundamentally breach the implied term of mutual trust and confidence where it is likely seriously to damage that relationship.

The Employment Tribunal upheld the Claimant's complaint of constructive unfair dismissal. The Respondent had suspended her and called her to an investigatory meeting concerning nine serious but insufficiently particularised allegations. The Tribunal found that the process was unfair, including the inadequate notice, non-disclosure of relevant material, and confused roles of those conducting the meeting. It held that the process fundamentally breached mutual trust and confidence and caused the Claimant's prompt resignation.

The Respondent appealed. It contended that the Tribunal had failed to consider a potentially fair reason and the range of reasonable responses, and had wrongly applied disciplinary-hearing standards to an investigation meeting.

1. Appeal dismissed. The Respondent had not pursued before the Employment Tribunal a positive alternative case that any constructive dismissal was fair for some other substantial reason. The issues identified at the hearing concerned whether there was a fundamental breach, causation and delay. The Tribunal was therefore entitled to proceed on the case advanced.

2. A finding of constructive dismissal does not itself establish unfair dismissal. Even where the repudiatory breach is of the implied term of mutual trust and confidence, the employer must show a reason capable of being fair under section 98 of the Employment Rights Act 1996. If it does so, the Tribunal must then determine fairness. The statutory burden does not require a Tribunal to devise a possible reason for dismissal on the employer's behalf.

3. On the Tribunal's findings, the conduct causing the resignation was an investigation so flawed that the Claimant could reasonably conclude that the Respondent wanted to remove her. The Respondent had not shown that this conduct was for a reason capable of being fair. The proposed case based on investigating alleged misconduct could not be inferred from the evidence or substitute for the employer proving its reason.

4. In any event, the findings would have placed the dismissal outside the range of reasonable responses. That conclusion was additional to, and not necessary for, dismissal of the appeal.

5. The Tribunal had not impermissibly imposed disciplinary-hearing rules on an investigation. The manner of an investigation depends on its circumstances, but an employer commits a fundamental breach where, without reasonable and proper cause, its conduct is likely to destroy or seriously damage trust and confidence. The Tribunal permissibly found that threshold met on the evidence.

• Employment Appeal Tribunal: dismissed the Respondent's appeal and upheld the Employment Tribunal's finding of constructive unfair dismissal.
• Employment Tribunal, Liverpool: upheld the Claimant's complaint of constructive unfair dismissal on 2 November 2018.