Employment Law – Test to Apply to determine Unfair Constructive Dismissal -  Long Term Sickness Breach of Implied Term of Trust and Confidence


The case of Ford v Abbycars (West Horndon) Ltd [2008] involved a decision on the test to be applied when considering whether an employee has been constructively dismissed. On the 1st of March 2004, the employee commenced work as a sales manager with the employer. He was involved in the employer's courier business and also provided occasional assistance with the employer’s taxi business.

The employee fell ill and his GP signed him off work from the 20th of March 2004, until the 11th of April 2006.

Then, on the 31st of March the employee received a letter from the employer's manager, G. The letter from G stated that the employer was willing to pay the employee full pay for the first week of his absence as a gesture of goodwill. The letter went on to state as follows:

“In view of your being absent for some time with sickness, we will need to arrange for collection of the pool car, as it is required for the business”.

The employee subsequently telephoned G and disputed as to whether the car was a pool car or not. After an agreement was reached with the employee, the car was duly collected. Then, by a letter which was dated the 12th of April 2006, the employee tendered his resignation.

He alleged that there had been a fundamental breach of the implied term of mutual trust and confidence in his contract of employment. Furthermore, a number of other breaches were alleged, which included:

§   Failure to pay agreed commission;

§   Failure to effect agreed pay rises;

§   Failure to provide payslips; and

§   Non-payment of a telephone allowance.

The employee stated that the fact that the car was taken back amounted to the 'final straw'. Eventually, the employee's resignation was accepted. Subsequent to that acceptance, the employee brought a claim before the employment tribunal arguing that he had been unfairly constructively dismissed.

The tribunal found in favour of his claim. It held that there had been two contractual breaches on the part of the employer, which were as follows:

§   The non-payment of the telephone allowance; and

§   The manner in which the employer had sought the return of the car.

The employer appealed against this decision, which led the employee to submit a cross-appeal.

On appeal, the employer submitted that the tribunal had been erroneous in coming to the conclusion that there had been repudiatory breaches by the non-payment of the allowance and the return of the car. The non-payment of the allowance, aside from a brief mention in the letter of resignation, had not been raised as a concern of the employee.

Therefore, the employer argued that it should have been unfair for the tribunal to comment that no explanation had been given for the non-payment when in fact none had been requested. With regards to the return of the car, the manner in which it was requested could not properly be described as a repudiatory breach of the employment contract.

In respect of the cross-appeal, the employee argued that the tribunal had failed to come to decisions on certain matters in issue between the parties.

The employer’s appeal was allowed and the employee’s cross-appeal was dismissed.

It was held that the tribunal had been incorrect when determining that the failure to pay the telephone allowance was a repudiatory breach. Instead, it should have only been deemed a minor concern for the employee.

Furthermore, the tribunal had been wrong to focus on the manner in which the return of the car was requested as opposed to the question of whether there had been a legitimate business reason for requesting the return of the car.

However, it should be noted, that the tribunal had not been incorrect in failing to make findings of fact on the matters raised on the cross-appeal. It was held that those matters were essentially peripheral, and therefore it was not erroneous for a tribunal to fail to make findings on every issue in dispute.

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© RT COOPERS, 2008. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances.


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