Argos Ltd v Kuldo

A constructive dismissal and an unfair dismissal are separate questions. A tribunal must first determine whether the employer committed a repudiatory breach accepted by the employee. It must then determine the reason for dismissal, whether it was potentially fair, and whether dismissal for that reason was fair in all the circumstances under Employment Rights Act 1996.

A tribunal's failure expressly to cite the established constructive-dismissal authorities is not an error where its findings show that it applied the required elements. However, it errs if it treats a constructive dismissal as necessarily unfair. Where redundancy is the agreed reason but fairness is fact-sensitive and unresolved, the fairness issue should be remitted.

The claimant was employed in a finance-management role. During a restructuring, the employer treated her as mapped into a new role after the other employee in the proposed pool resigned. The claimant disputed that the roles were sufficiently similar, raised a grievance and resigned after its rejection.

The Employment Tribunal found repudiatory breaches of the implied term of trust and confidence arising from lack of consultation, flawed role mapping and an inadequate grievance appeal. It held that the claimant had been constructively unfairly dismissed. The employer appealed.

The central issues were whether the Tribunal had erred in finding constructive dismissal, whether it had separately decided unfairness, and how the suitable-alternative-employment issue should be dealt with.

1. Appeal allowed in part. The EAT upheld the finding of constructive dismissal but set aside the finding that it was unfair. The unfair-dismissal issue was remitted to the same Employment Tribunal.
2. The Tribunal's reasons showed that it had addressed the essential components of constructive dismissal. It found three breaches of the implied term of trust and confidence, found each repudiatory, and found that the claimant resigned in response without affirming the contract. Its failure to set out the governing authorities or the formulation of the implied term did not establish a legal misdirection: its analysis was objective and was based on matters known to the claimant at the time.
3. A constructive dismissal is not necessarily unfair. The Tribunal had to determine the reason for dismissal, whether it was potentially fair, and whether dismissal for that reason was fair in all the circumstances under Employment Rights Act 1996. It neither made a clear finding on the reason nor gave adequate reasons for moving from constructive dismissal to unfair dismissal.
4. Both parties accepted that, if there was a dismissal, its reason was redundancy. The EAT therefore held that redundancy was the inevitable reason. Fairness nevertheless required a fact-sensitive assessment which the EAT could not itself undertake.
5. The Tribunal was entitled to reject the argument that the claimant had accepted a permanent contractual variation by working in an interim role pending consultation on a fuller restructure. Its perversity findings were also unassailable.
6. The prior finding on suitable alternative employment could not stand as a concluded determination. Suitability may bear on fairness and on the redundancy-payment claim under Employment Rights Act 1996. Both matters were left for fresh consideration, together with the outstanding wrongful-dismissal and redundancy-payment claims.

• Employment Appeal Tribunal: Appeal allowed on the Tribunal's failure separately to determine unfairness and on the treatment of suitable alternative employment; the constructive-dismissal finding was upheld. Fairness was remitted to the same Tribunal.
• Employment Tribunal, Cambridge: Employment Judge James held that the claimant had been constructively unfairly dismissed. Judgment and reasons were sent on 8 March 2019.