In Walker v Robsons (Rickmansworth) Limited the employment tribunal found that, on the facts, a move to a 'junior desk' amounted to conduct likely to destroy or seriously damage the relationship of trust and confidence between employer and employee.
Background
A constructive dismissal is when an employee resigns and can show that they were entitled to do so because of their employer’s conduct. To establish they have been constructively dismissed an employee must show:
- There was a breach of a contractual term;
- The breach was sufficiently serious (a repudiatory breach of contract);
- They left because of the breach; and
- They have not waived the breach (i.e. not delayed too long before resigning or behaved in a way which indicates that they have accepted the breach).
Constructive unfair dismissal claims often arise in the context of the implied duty of mutual trust and confidence. Demoting an employee or changing their status/responsibilities without good reason may constitute a breach of the implied term of trust and confidence (as well as being a breach of the express terms of the employment contract, unless specifically permitted in the contract).
Facts
Robsons is an independent estate agency with branches in Rickmansworth and Chorleywood. Mr Walker was Rickmansworth's branch manager, while Mr Gooder was the branch's associate director.
In 2022, Mr Walker was informed that he would be moved to the Chorleywood branch following the recruitment of a new manager in Rickmansworth. In 2023, Mr Walker's replacement left, and he was asked to return to Rickmansworth, unaware he'd share the branch manager role with Mr Gooder.
At the Rickmansworth branch, the branch manager traditionally sat at the back of the office with the books and ledgers. Mr Walker previously sat there, as did his predecessors. The desk held “practical and symbolic” significance. After Mr Walker's replacement left, Mr Gooder moved to the desk.
Mr Gooder contacted Mr Walker to discuss his return and told him “You are going in the middle” when talking about desk arrangements. Following this exchange, Mr Walker felt that his status within the office would be "undermined" as he’d be seen as Mr Gooder’s assistant, not the branch manager.
Mr Walker was not prepared to sit in the middle of the office and ended up in heated discussions with the company director, Mr Young, who commented that he couldn't believe a 53-year-old man was making a fuss about a desk. Mr Walker was given the ultimatum of returning to Rickmansworth or facing disciplinary action.
Mr Walker threatened to resign. Mr Young responded, "Go on then," before leading Mr Walker to draft his resignation letter. Two days later, Mr Walker tried to retract his resignation, but his calls went unanswered. He raised claims for constructive unfair dismissal and age discrimination.
Decision
The tribunal found that there had been a breach of the implied term of mutual trust and confidence, and that Mr Walker had been unfairly constructively dismissed. The following were found to amount to breaches of the implied term of trust and confidence:
- The failure to inform Mr Walker that he would be sharing the managerial role with Mr Gooder;
- Mr Walker being told to sit at the middle desk, which he perceived to be a demotion;
- Mr Young's behaviour in shouting at Mr Walker, remarking on his age and the “fuss” over the desk, and then threatening him with disciplinary action;
- The failure to give Mr Walker a job description for his new role.
The tribunal held that it was a “logical conclusion” for Mr Walker to draw that being assigned to the middle desk was a demotion, particularly in circumstances where the communication about the logistics of the move had been poor.
The age discrimination claim was dismissed as there was no less favourable treatment based on age - the tribunal found that “not every reference to a person’s age is an act of unlawful discrimination”.
Outcomes
This case is a reminder that when confronted with demotion or changes to their role/responsibilities without good reason, there is a risk of an employee resigning and pursuing a constructive dismissal claim based on a breach of the implied term of trust and confidence. It also highlights the significance of certain "status symbols" to employees and the need to communicate effectively about workplace changes.
To minimise the risk of litigation, employers should establish open and transparent communication with employees, clearly explaining the reasons behind decisions impacting their employment. Grievances should be addressed quickly and effectively. Any steps taken, and the reasons behind them, should also be appropriately recorded and documented.
For more information about anything discussed in this blog, please contact the Brodies Employment and Immigration team.
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