UNITED ARTIST CORPORATION LTD v MR A D WENDT [2005] UKEAT 0886_04_0403

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2005] UKEAT 0886_04_0403Case No Appeal No. UKEAT/0886/04Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
UNITED ARTIST CORPORATION LTDAPPELLANTMR A D WENDTRESPONDENT
Before
His Honour Judge Prophet Mr J Mallender Dr K MohantyDate 4 March 2005
[1]APPEARANCES For the Appellant MR AKAH NAWBATT (of Counsel) Instructed by: Messrs Denton Wilde Sapte Solicitors One Fleet Place London EC4M 7WS For the Respondent MR AYOADE ELESINNLA (of Counsel) Instructed by: Messrs Lyons Davidson Solicitors Oriel House 52-54 Coombe Road New Malden KT3 4QP SUMMARY Unfair Dismissal Flawed finding of constructive dismissal due to failure to make appropriate findings of fact and to explain what formed the fundamental breach of contract – Employment Tribunal judgment quashed and case remitted for rehearing. HIS HONOUR JUDGE PROPHET This appeal arises out of a judgment by an Employment Tribunal sitting at London South on 18 and 19 August 2004, followed by a chambers meeting on 21 September 2004, with Miss Lester as the Chairman, and Mrs Driver and Mr Roberts as the lay members. Both sides were represented by Counsel, Mr Roy for Mr Wendt and Mr Nawbatt for the employer. The outcome was that Mr Wendt was found to have been constructively dismissed by the employer and that that dismissal was unfair. In respect of that unfair dismissal the Claimant, Mr Wendt, was awarded compensation in the sum of £6,553.92, subject to recoupement.[2]A Notice of Appeal, dated 18 November 2004, was submitted by the employer and in an Order by Rimer J, sealed on 14 December 2004, that appeal was set down for a full hearing before this Appeal Tribunal. We are constituted today to conduct that full hearing. Mr Nawbatt once again represents the employer, and Mr Elesinnla of Counsel represents Mr Wendt. We would like to say that we are very grateful to both Counsel for the quality of the submissions which they have made to us today.[3]The grounds of appeal can be summarised in this way. The first ground is that a six-week delay in informing Mr Wendt of his proposed promotion/new role cannot, as a matter of law, have amounted to a repudiatory breach of contract and/or was a decision which no reasonable tribunal could have come to. The second ground of appeal relates the findings as to the effective cause as compared with what Mr Wendt was alleging. The third ground of appeal relates to the application by the Tribunal of section 98(4) of the Employment Rights Act 1996 . The fourth ground of appeal is that the Tribunal failed to address the issue of Polkey which was raised by the Appellant at the Employment Tribunal.[4]Mr Wendt worked as an Accounts Assistant for United Artists Corporation Ltd from 31 July 2000. On 24 March 2004 his employment ended. That was a result of his handing in a resignation letter on 25 February 2004. This is what he said in his resignation letter:
"It is with great regret that I herewith tender my resignation from United Artists Corporation Ltd, and give you one month's formal notice to take effect from today, as laid down in my contract. I am extremely sorry that I have had to reach this decision, but my situation here has now become intolerable. I regard myself as an asset to your department, and to the Company. I have executed an increasingly heavy workload, far in excess of that required in my job description, and with no recognition of the same. The uncertainty I have had to endure in recent months regarding my position here has been an added burden. The fact that there is no room for negotiation leaves me with no alternative but to resign."
[5]It is apparent from the content of the Originating Application and the Notice of Appearance that there substantial differences between what Mr Wendt would say as to what happened, prior to his resigning, and what the employer would say on that matter. At the time of resignation he had been informed that restructuring had eliminated the post of Accounts Assistant, which was his post, but it had introduced a post of Senior Accounts Assistant at a higher salary, which was duly offered to and at first accepted by Mr Wendt.[6]It appears from the Employment Tribunal's very brief Reasons that they considered that a delay of some six weeks in advising Mr Wendt of the consequences of the restructuring, insofar as that impinged upon his position, constituted a fundamental breach of the implied term of trust and confidence, which justified Mr Wendt's resignation being a constructive dismissal under section 95(1)(c) of the Employment Rights Act 1996 .[7]The essential question which arises in this appeal is how did the Employment Tribunal reach that conclusion? There is no reference in the Reasons to that section of the Act , or to any cases relating to it, or, as to what might constitute a breach of the implied term of trust and confidence: see, for example, Browne-Wilkinson J, as he then was, in Woods vWM Car Services (Peterborough) Ltd [1981] IRLR 347, at page 350. Whilst we would never encourage employment tribunals to be prolix in their reasons, there is a complete lack in the Employment Tribunal Reasons in this case as to any finding of fact on the matters which it needed to set out in order to show how Mr Wendt, in reaching the stage of resignation, met the requirements of section 95(1)(c).[8]The substantial differences between the parties on these matters, as envisaged in the Originating Application and the Notice of Appearance, duly emerged at the hearing and are not satisfactorily resolved in the Employment Tribunal's Reasons. Furthermore, it is unclear what precisely formed the fundamental breach of contract, and whether that was confined to the delay, or whether other, and if so what other, factors, such as alleged bullying and harassment, came into it. These are fundamental gaps in what should have been contained in the Employment Tribunal's Reasons. The situation reached was that it must have been impossible for the employer to understand why the Employment Tribunal found in favour of Mr Wendt and against them.[9]We are quite satisfied, unanimously, that this judgment by the Employment Tribunal is unsatisfactory and constitutes an error of law. The appeal is allowed and the judgment is quashed. We are satisfied also, although we have borne in mind the President's guidance in the recent case of Sinclair Roche & Temperley v Heard [2004] IRLR 763 , that the only proper course to adopt in this case is for the case to be remitted for a complete rehearing before a differently constituted employment tribunal, to include a correct approach to remedy if that remains, after a decision on the merits.