UNFAIR DISMISSAL. Preparation

Transcription

1 UNFAIR DISMISSAL Preparation This seminar involves an examination of the statutory concept of unfair dismissal. In order to prepare for this seminar you should read from one or two of the textbooks from the general reading listed below. You should then look at and consider the four questions that will be discussed. For each question you should read any specific material cited and undertake any specific tasks set. General Reading: Deakin & Morris pp and Selwyn chapters 12 & 17* Honeyball & Bowers chapter 8* Painter and Holmes chapter 8* Pitt, pp * Smith & Wood chapter 7* Advanced Reading: Freedland (2 nd ed. 2003) The Personal Employment Contract pp Collins (2 nd ed. 2010) chapter 8 Hugh Collins, Justice in Dismissal (OUP, Clarendon, 1992) chapters 2, 3 & 4 Journal Reading: P. Elias, Unravelling the Concept of Dismissal-I and II (1978) ILJ 16 and 100 P. Elias, Fairness in Unfair Dismissal: Trends and Tensions (1981) 10 ILJ 201* A Freer, The Range of Reasonable Responses Test: From Guidelines to Statute (1998) 27 ILJ 336* Hugh Collins and Mark Freedland, Finding the Right Direction for the Industrial Jury : Hadden v Van den Bergh Foods Ltd/Midland Bank plc v Madden (2000) 29 ILJ 288* S. Anderman, Termination of Employment: Whose Property Rights? in C. Barnard, S. Deakin and G. Morris (eds), The Future of Labour Law: Liber Amicorum Bob Hepple QC (Oxford: Hart, 2004) 103 4* David Cabrelli, The Hierarchy of Differing Behavioural Standards of Review in Labour Law (2011) 40 ILJ 146 at pp * Question 1: How does the law define dismissal? In answering this question consider both the statutory definitions and cases which have arisen therefrom. In addition, make a list of the automatically unfair dismissals. Question 2: Page 1 of 57

2 How does the statutory test of unfairness set out in section 98 of the Employment Rights Act 1996 operate? Illustrate your answer with relevant cases. Explain the difference between substantive justice and procedural justice in the context of unfair dismissals. Question 3: What is the status of the ACAS Code of Practice on Disciplinary Practice and Procedures in Employment? What are an employer's procedural obligations regarding dismissal? Ss A Employment Rights Act 1996 Ss Employment Relations Act 1999 Ss 1-3 Employment Act 2008 Question 4 What are the remedies for unfair dismissal? Are they adequate? Polkey v AE Dayton [1988] AC 344 Specific Reading: Deakin and Morris pp * Hugh Collins, Compensation for the Manner of Dismissal 2004 ILJ (Discusses the Court of Appeal s decision in Dunnachie v Kingston upon Hull C.C.) * John Bowers & Jeremy Lewis, Non-economic Damage in Unfair Dismissal Cases: What s Left After Dunnachie? (2005) 34 ILJ 83* Dunnachie v Kingston Upon Hull City Council [2004] IRLR 727* Burlo v Langley & Carter [2007] IRLR 145 Page 2 of 57

3 Question 1 How does the law define dismissal? In answering this question consider both the statutory definitions and cases which have arisen therefrom. In addition, make a list of the automatically unfair dismissals. Unfair dismissal: The dismissal of an employee which is unfair in terms of Part X of the Employment Rights Act 1996 The meaning of dismissal There are three types of dismissal. If an employee cannot show that he has been dismissed, his claim for unfair dismissal will be ruled out by an employment tribunal. s.95 of the ERA 95. Circumstances in which an employee is dismissed. (1) For the purposes of this Part an employee is dismissed by his employer if (and, subject to subsection (2) [ ]1, only if) (a) the contract under which he is employed is terminated by the employer (whether with or without notice), by or ] 2 [ (b) he is employed under a limited term contract and that contract terminates virtue of the limiting event without being renewed under the same contract, (c) the employee terminates the contract under which he is employed (with or without notice) in circumstances in which he is entitled to terminate it without notice by reason of the employer's conduct. REVISION NOTE Page 3 of 57

4 s.95(1)(a) of the ERA 1996 entails a positive act of dismissal by the employer, i.e. where the employer fires the employee. s.95(1)(b) applies where a fixed-term contract comes to its natural end. s.95(1)(c) describes the constructive dismissal of an employee. Fixed-term contract: A contract which endures for a specific period of time and terminates at the end of that period of time. Constructive dismissals Constructive dismissal is a form of unfair dismissal. As a result, it is governed by Part X of the ERA The definition of constructive dismissal is detailed in s.95 of the ERA PROBLEM employee must repudiate contract i.e. give up job. KEY STATUTORY PROVISION ERA 1996, s. 95 (1) For the purposes of this Part an employee is dismissed by his employer if... (c) the employee terminates the contract under which he is employed (with or without notice) in circumstances in which he is entitled to terminate it without notice by reason of the employer s conduct. The nature of the employer s conduct S.95(1)(c) of the ERA 1996 enables an employee to terminate the contract of employment without notice in response to the employer s conduct. The question is what standard of conduct of the employer is relevant for the purposes of the section? Western Excavating (ECC) Ltd v Sharp (1978) Held: That whether the employer s conduct was reasonable or unreasonable was not the appropriate test. Instead, the question was whether the employer s conduct: amounted to a significant or repudiatory breach of contract going to the root of the contract of employment, or demonstrated that the employer no longer intended to be bound by one or more of the essential terms of the contract. Page 4 of 57

5 Examples of repudiatory conduct Some examples of repudiatory conduct are as follows: Gillies v Richard Daniels & Co. (1979) Reducing an employee s benefits to a material extent; Coleman v S. & W. Baldwin (1977) and Industrial Rubber Products v. Gillon (1977) Reducing an employee s status or salary; Any serious breach of the implied terms of the contract of employment, e.g. the implied term of mutual trust and confidence, the implied term to exercise reasonable care, etc. In such circumstances, the employee is entitled to treat himself as: discharged from any further performance, and constructively dismissed, and can seek compensation. Stanley Cole (Wainfleet) Ltd v Sheridan [2003] IRLR 52 Concerning: repudiatory conduct, constructive dismissal Facts Mrs Sheridan had an altercation with another employee which upset her and made her feel ill. She left the office without permission and was absent for about an hour and a half, including her lunch hour. When she returned, she was told to go home. An investigation and disciplinary hearing took place which resulted in her being issued with a final written warning for leaving the workplace without permission. She left her employment and claimed constructive dismissal. Held (EAT): That the employer had committed a repudiatory breach of contract in giving the employee an unjust and unmerited warning or other disciplinary sanction which was disproportionate to the misconduct of the employee. A final written warning is a severe penalty which is given for conduct which just stops short of that justifying dismissal. However, the employee s misconduct was minor and so the final written warning was disproportionate. Page 5 of 57

6 Land Securities Trillium Ltd v Thornley [2005] IRLR 765 Concerning: repudiatory conduct, constructive dismissal Facts Ms Thornley was employed as an in house architect. Although she had certain management responsibilities, her main duties were those of a hands on architect. As part of a restructuring, Ms Thornley s duties were altered to a mainly managerial role on the basis of a flexibility clause in her contract of employment. She contended that the alterations were such that she was being asked to perform a different job without her consent. She left her employment and claimed constructive dismissal. Held: The employer was in fundamental breach of her contract of employment in imposing a new job description. The job description changed her duties from a hands on role to a mainly managerial one and had the effect of deskilling her as an architect. Accordingly, she had been constructively dismissed. Stages involved in constructive dismissal See Figure 10.1 for a description of the relevant issues which are taken into account where an employee makes a complaint of constructive dismissal. From Figure 10.1, you will note that it is crucial that the employee accepts the employer s repudiatory breach of contract at stage 3. For the purposes of stage 3, it is not an absolute requirement that the employee informs the employer at the point he/she leaves employment that the reason that he/she is leaving is the employer s repudiatory breach of contract (Weathersfield Limited (t/a Van & Truck Rentals) v Sargent (1999)). With regard to stage 2, where an employee alleges that the employer s conduct was such that it amounted to a breach of the implied term of mutual trust and confidence, the case of Morrow v Safeway Stores (2002) held that this will automatically amount to a repudiatory breach of contract. Stage 1 There must be conduct of the employer towards the employee Stage 2 Which conduct amount to a repudiatory breach of the contract of the employee Stage 3 Which repudiation is accepted by the affected employee Stage 4 And the employee resigns in response to such repudiatory conduct within a reasonable period of time without affirming that breach Page 6 of 57

7 Stage 5 Then it is likely that the employee has been constructively dismissed REVISION NOTE Whether the employer s conduct is such that the employee is entitled to claim constructive dismissal depends on whether there has been a repudiatory breach of contract on the part of the employer. This, in turn, directs an enquiry as to whether (i) the conduct of the employer is consistent with a repudiatory breach on their part or (ii) an express or implied term of the contract of employment has been breached. REVISION NOTE Constructive dismissal = wrongful dismissal. So if an employee can show that the conduct of an employer amounts to a repudiatory breach of contract, he/she must decide whether to raise a wrongful dismissal claim OR a constructive dismissal claim. The option he/she chooses will commonly depend on his/her length of service and the level of compensation he/she is seeking. Affirmation If an employee approves of the employer s conduct (which amounts to a repudiatory breach) then he will be deemed to have waived his right to claim constructive dismissal. Such approval is called affirmation. Whether the employee has affirmed or consented to the employer s repudiatory breach is a matter of fact and degree. Simms v Sainsburys Supermarkets (2005) Held (EAT): That a delay of ten weeks between the date of the employer s repudiatory breach and the date the employee left employment was too long. Page 7 of 57