GMB TRADE UNION v MS J BROWN [2007] UKEAT 0621_06_1610

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2007] UKEAT 0621_06_1610Case No Appeal No. UKEAT/0621/06/ZT UKEAT/0442/06/ZTVenue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
GMB TRADE UNIONAPPELLANTMS J BROWNRESPONDENT
Before
Mr Justice EliasDate 16 October 2007
[1]APPEARANCES For the Appellant MR OLIVER SEGAL (of Counsel) Instructed by: Messrs Thompsons Solicitors The St Nicholas Building St Nicholas Street NEWCASTLE-upon-TYNE NE1 1TH For the Respondent MR SEAMUS SWEENEY (of Counsel) Instructed by: Messrs Burnetts Solicitors 6 Victoria Place CARLISLE CA1 1ES SUMMARY Unfair Dismissal: Reason for dismissal including substantial other reason / Compensation The employee claimed constructive unfair dismissal because the employers refused to modify their grievance procedures to deal with her grievance. She alleged, and the Tribunal accepted, that it could damage her health if she had to pursue the grievance formally with her line manager. He was the person against whom she was complaining. The Tribunal found that there was a dismissal and it was unfair. The EAT on appeal held that in the somewhat unusual circumstances of this case, it was a finding open to the tribunal on the evidence. Hence the appeal on liability failed. The employers also alleged that the Tribunal had erred in various ways in its assessment of compensation. The EAT upheld one of the grounds but rejected the others. The compensation was as a consequence adjusted by an amount agreed between the parties. Observations on dicta in the cases of Johnson v Unisys Ltd [2001] ICR 480 and Eastwood v Magnox Electric plc [2004] ICR 1064 . THE HONOURABLE MR JUSTICE ELIAS (PRESIDENT) This is an appeal against two decisions of the Employment Tribunal sitting in Newcastle. In the first decision the Tribunal found that the Claimant, the respondent to this appeal, had been unfairly constructively dismissed. In the second decision they assessed her compensation. Her employers, the GMB trade union, appeal against the finding that she was constructively dismissed and also contend that the Tribunal erred in various ways in its calculation of the compensation. We will deal with the two decisions separately. We refer to Ms Brown as the Claimant, as she was below. There was also a claim under the Disability Discrimination Act which failed, and there is no appeal with respect to that part of the decision. The background[2]The Claimant began employment in June 1998. She was secretary to the then political officer, Mr K Jones. She became his political assistant and subsequently the political assistant to the regional secretary, who was then Mr Kevin Curran. In 2001 Mr Jones was elected as a Member of Parliament and the Claimant was appointed by Mr Curran to the post of Regional Political and External Relations Officer. This post involved liaising with the Labour Party and assisting Mr Curran in his involvement with a local development agency, One North East. It also required her to carry out certain recruitment duties. It was her ambition to pursue a career as a political officer and to stand for election as a Member of Parliament.[3]In May 2003 Mr Curran became general secretary of the union. Mr Tom Brennan was appointed to the post of regional secretary, replacing Mr Curran. This caused the Claimant some concern. She believed that Mr Brennan did not like her and that she was identified as a member of Mr Curran's inner circle. She suspected that Mr Brennan would transfer her political duties to another officer, Julie Elliot.[4]Mr Brennan, on taking office, reviewed the priorities of the region. The finances were in an unhealthy state and he wished to give priority to recruiting new members. Two of the senior staff officers left and their duties were re-allocated. He took the view that there was no need for a formal office of political and external relations. Mr Curran had resigned from the local development agency and Mr Brennan thought that the role had diminished. He also was of the opinion that the Claimant was not successfully combining her political and recruitment roles. He formed the preliminary view that she should give up the political role and concentrate on her recruitment duties.[5]There was a meeting between Mr Brennan and the Claimant on 24 June 2003. Each accused the other of being hostile, unco-operative and uncompromising. The Claimant wrote to Mr Brennan on 30 June stressing that she wished to remain in the role of political officer and she contended that she had indeed successfully combined this with her recruitment duties.[6]There was a further meeting on the 10 July. Essentially each maintained their positions with neither willing to give way. The Claimant sent a letter on the 11 July saying that she had taken advice from the Officers Negotiating Council (ONC) and that she wished to continue in her post. The ONC is the body that deals with negotiations over such matters as terms and conditions for officers in the position of the Claimant[7]Mr Brennan responded in a letter dated 23 July, in which he recapped his proposal, encouraged her to accept it, and told her that if she did not agree then the letter was to be treated as a formal proposal to change her contract of employment with effect from 1 September 2003. He invited her to a further meeting on 29 July 2003.[8]She replied on 28 July, raising a grievance with Mr Brennan. She said that his letter of 23 July amounted to a termination of her position as political officer, that he had failed to give her correct notice, and that this amounted to a dismissal. She contended that it was inappropriate to hold a meeting on 29 July.[9]Mr Brennan replied that the grievance was inappropriate since no final decision to remove her political duties had been taken; the purpose of the 29 July meeting was to further consult on the proposal. The Claimant did in fact attend a meeting on that date but it was unproductive and futile. Each party, as the Tribunal found, became even more entrenched.[10]On 8 August the Claimant wrote again to Mr Brennan, having taken advice from an ONC officer. She reiterated her unwillingness to accept the change, alleged that she was being harassed into accepting the new post, threatened tribunal proceedings, and told him that the matter was having an adverse effect on her physical and mental wellbeing.[11]There was a fourth unproductive meeting on 19 August 2003. The Tribunal specifically found that by this time Mr Brennan must have realised that further meetings were futile and were adversely affecting the Claimant's health.[12]On 28 August the Claimant wrote to Mr Brennan, asking him to proceed with her grievance. She added that she wanted to raise a further grievance of sex discrimination. She contended that the first stage of the grievance procedure had been exhausted and that she wished to go on to the second stage.[13]The grievance procedure in operation at the time had three stages. Stage one required the officer to take the matter up with the line manager, and in this case, that was Mr Brennan. Stage two provided that grievances referred from stage one should be considered by the regional secretary/general secretary/assistant general secretary. The regional secretary was again Mr Brennan. The final stage, if there had been no earlier resolution, involved a joint panel consisting of two representatives of management and two representatives of the ONC sub-committee. The Claimant had been told that on a previous occasion where there had been a complaint raised against a regional secretary of harassment, the issue had gone straight to stage three. That is what she wanted in this case (although she referred to it as stage 2).[14]Mr Brennan rejected her suggestion and requested the Claimant to process her grievance in accordance with the procedures by attending a meeting with him on 3 September. He also asked for details of the sex discrimination grievance. At that point the Claimant was on annual leave and could not attend the meeting. Mr Brennan warned her that failure to comply with a reasonable instruction was potentially a disciplinary matter. He sent a further letter on 9 September, requesting a further meeting "in the consultation process" to take place on 11 September. The Tribunal noted that at this stage the Claimant's health was suffering. She was upset and stressed; she was not sleeping, and she kept vomiting. She had a sick note from her GP on 10 September for a period of one month. It diagnosed occupational stress. The doctor said the Claimant was unable to attend confrontational meetings. In fact, she never returned to work.[15]On 19 September Mr Brennan asked Julie Elliott, the regional organiser, to cover the Claimant's political duties. On 21 November 2003 Mr Brennan wrote to the Claimant at her home, saying he proposed to eliminate the role of political and external relations officer with effect from 9 January 2004. (In fact Ms Elliott would undertake such political duties as remained). He noted that the Claimant had rejected the role of recruitment officer and there were no other available posts, so he sent her details of the union's voluntary redundancy scheme and invited her to a meeting on 28 November 2003 to discuss the matter further. He had also earlier asked her, together with all other officers, to pay for personal calls on their mobile phone to the extent that the cost exceeded the free calls included in the tariff.[16]Mr Brennan invited the Claimant to a meeting on 28 November to discuss her position further, but she was not able to attend because of occupational stress. She wrote on 21 January 2004 to Mr Brennan telling him she was pregnant. Mrs Brown had been advised by the ONC secretary, Mr Carrigan that the grievance should be pursued at stage 3 and Mr Carrigan had asked Mr Mendelsohn, the union's personnel officer, to arrange a panel hearing. Mr Brennan wrote to her on 26 March saying that this was quite inappropriate because she had not exhausted the first two stages. However, he added that it would not be sensible to proceed with the grievance while she was still suffering from occupational stress.[17]On 30 June 2004 Mr Brennan wrote to Mrs Brown again, asking her to return her phone and laptop computer. She objected to that. He later allowed her to retain the phone but insisted on the return of the laptop and that was subsequently returned. Meanwhile, Mr Brennan was asked by the Claimant's solicitors not to communicate directly with her. Her maternity leave was due to expire on 5 November 2004 but she was not well enough to return to work on that date. She continued to submit sick notes.[18]By this stage the GMB had introduced its Dignity at Work Procedure in June 2004. This was a specific procedure designed to deal with bullying and harassment by certain senior officers of the union who did not have line managers. These included regional secretaries. There are two stages in the procedure. The first involves the employee raising a complaint formally with the senior manager concerned. Both parties and representatives should make every effort to resolve the issue at this stage; the key aim of all concerned should be to try to develop future harmonious working relationships. The procedure states - perhaps somewhat optimistically - that it is expected that most complaints will be resolved at this stage. If it does not become possible to resolve the issue through discussion then the employee can trigger the second stage. This takes the form of a hearing by an independent panel chaired by an independent ACAS appointed arbitrator. The chair will be supported by a representative of either the ONC or the HSRC (as appropriate) and a designated member of management acting as "wing members". There are various stages and time limits specified in the procedure. The wing members' role is not to act as part of the panel as such but merely to assist the independent arbitrator.[19]A formal grievance was lodged by Ms Brown on 4 February 2005; some months after her solicitors had intimated her intention to do this. It was a lengthy document. It objected to the political role being taken away from her and the way it had been handled. It complained of the failure to deal with her grievance and the consequences for her health. There were various grievances in respect of other matters, including the removal of the computer and the proposed taking back of the telephone. It was said that Mr Brennan had been abusive and intimidating at the meetings with her in July 2003, and that she was being harassed to the detriment of her health and her future career. The letter was sent to the general secretary, Mr Curran, who passed it to Mr Mendelsohn and sent a copy to Mr Brennan. Meanwhile, the Claimant's entitlement to sick pay expired on 9 March 2005. Mr Brennan was requested to extend the payment of sick pay, but refused to do so.[20]On 3 March 2005 Mr Mendelsohn wrote to Ms Brown asking her whether she had complied with the timetable and the procedure laid down in the grievance procedure. He told her that if she had not followed the procedures as outlined in the document then the panel would not hear her case.[21]At this stage Ms Brown was being represented by Mr King, senior organiser in Scotland. He was seeking a satisfactory solution to the dispute. He wrote to Mr Brennan on 23 March 2005 asking him to continue to pay sick pay until a solution could be found. Mr Carrigan made a similar request. Mr Brennan indicated that he would meet the Claimant in accordance with the procedure but that he would not extend sick pay. The Claimant's solicitors wrote to Mr Mendelsohn challenging any assertion that she had not complied with the time limits and reiterating that the matter should be heard by the independent arbitrator.[22]Mr Mendelsohn forwarded the letter to Mr Brennan, who replied to the Claimant on 25 April that she had still not followed the grievance procedures. Meanwhile, Mr Curran had left as general secretary and Mr Kenny had been appointed acting general secretary. Mr King wrote to him suggesting a meeting. Mr Kenny replied on 19 May 2005 stating that he could not see how a meeting would be of any assistance. He added this:
"I appreciate Jane's and indeed your desire to avoid litigation and I sincerely hope that a positive use of the grievance procedure will avoid this for all parties. I have spoken to Tom Brennan who advised that he is awaiting a proposal from Jane to resolve the situation. My strong advice is that you seek to continue the dialogue with Tom to try to find an amicable resolution before proceeding upwards through the grievance machinery."
[23]The reference in that second paragraph to Tom Brennan awaiting a proposal from the Claimant is not altogether clear. It is not disputed, although not recorded in the Tribunal's decision, that Mr King had met Mr Brennan and they had what Mr King referred to as a "constructive discussion". It appears at this stage that Mr Brennan was still expecting to hear some response from the Claimant as a consequence of that meeting. Whether that was by way of a possible resolution outside the terms of the formal procedures or whether he was envisaging that she might after all be prevailed upon to progress through the first stage of the Dignity at Work Procedure is not clear, and neither counsel could assist us about it.[24]On receipt of this letter the Claimant considered that she had had enough. She felt that there was no proper attempt to determine her grievance; she was no further forward than she had been in July 2003. She resigned by letter dated 20 May. The letter said this:
"For a number of months now I have attempted to pursue a grievance in relation to the manner in which I have been treated by my employer, notably Tom Brennan. This grievance has been thwarted at every stage and I feel now that I have no option but to resign. I believe the manner in which I have been treated, and particularly the fact that my attempts at raising a grievance have been frustrated, demonstrates that the relationship between myself and my employer has broken down irretrievably. I would emphasise that it is with great sadness that I have reached this decision."
[25]There have been two matters to which we draw attention. The first has been the subject of some dispute between the parties. It is whether the grievance lodged in February 2005 under the Dignity at Work procedures was intended to replace the earlier grievance or whether it was intended to supplement it. The position is not altogether clear, but we think that the better view, relied upon by Mr Segal, is that Ms Brown did consider that her new grievance was replacing the old one. We say that both because of the way in which the grievance was formulated, not least the fact that it reiterates the original grievance, and because there are various passages in her witness statement which we need not recount here which strongly indicate that she understood that she was raising one grievance and not effectively two distinct grievances. Nor do we think that either party would realistically have considered that there should be two separate resolutions of what were on any view plainly inter-related grievances. We also consider that that is also how the Tribunal has seen it; they refer to the grievance as having been "reformulated." What is plain, however, is that whichever grievance was being invoked, the Claimant made it unambiguously clear that she was wholly unwilling to take part in any stage involving Mr Brennan. She wanted an independent resolution of her complaints.[26]The second issue concerns the scope of the grievance. Again, we are satisfied that the later grievance lodged under the Dignity at Work Procedure plainly was in various ways more extensive than the earlier one. The Tribunal found, however, and we accept they were entitled to find, that her essential complaint at all times was the taking away of the political duties, with the adverse consequence to her future career. There were other matters which were identified in the later grievance, such as the issues concerning her telephone and laptop computer which supplemented the original grievance and were relied upon as part of the overall allegation of harassment. Mr Segal, counsel for the union, is plainly correct, however, to say that the supplementary matters, unlike the principal complaint, had not been the subject of any direct discussion with Mr Brennan at all. Nor had the earlier meetings focused on the allegation of harassment. The Tribunal's analysis[27]The Tribunal directed itself on the law relating to constructive unfair dismissal and there is no criticism of those directions. The Claimant submitted that she had been constructively dismissed and that her dismissal was unfair. The union contended that there had been no constructive dismissal. There was no separate argument that even if there were such a dismissal it was in the circumstances fair.[28]The Claimant alleged that by insisting on her having to pursue her grievance directly with Mr Brennan, the union as her employer had undermined trust and confidence in the employment relationship. They ought to have been willing to display some flexibility in the operation of their procedures, given in particular that the Claimant's health was being adversely affected by direct meetings with Mr Brennan.[29]The union contended that it was plainly reasonable for them to insist on the Claimant complying with each stage of the grievance procedure. The Dignity at Work Procedure specifically envisaged that the grievance would initially be raised with the officer against whom the complaint had been made. It could not therefore be contended that this was inappropriate or should be waived for that reason alone since that would fundamentally alter the procedure which had been specifically agreed by the ONC. Indeed the employers contended that the Claimant could not possibly succeed in a constructive dismissal claim in circumstances where procedures were in place, where she had the opportunity to use them in order to advance her grievance, and she had of her own volition chosen not to do so.[30]The Tribunal rejected this submission. They in terms indicated that they were not making any finding that Mr Brennan's decisions with respect to transferring the political duties to Ms Elliot were improper or unjustified. They were, however, satisfied that the union had undermined trust and confidence by failing to progress the Claimant's grievance. The refusal by Mr Kenny, the acting general secretary, to meet the Claimant or her representative was the final straw which caused her to resign. There had been a continuing failure to determine the grievance and the Claimant had never by her conduct affirmed the breach.[31]The Tribunal considered that in one respect the situation was similar to that identified by this Tribunal (Morrison P presiding) in W A Goold (Pearmak) Ltd v McConnell [1995] IRLR 516 . In that case there were no procedures for determining grievances and the employers failed to deal with the grievance of two Claimants whose pay had been reduced as a result of a change in the commission arrangements. The EAT said this:
"This case is of course as Mr Sweeney, counsel for the Claimant accepts, materially different in this sense that here there was a procedure and the employers were prepared to hear the grievance which was pursued in accordance with that procedure."
[32]However, he submitted that just as in the Goold case there was no practical opportunity for the Claimant to pursue her grievance because it was potentially damaging her health to have to raise the issue directly with Mr Brennan as Mr Brennan knew. The Tribunal essentially accepted that argument. They said this at paras 4.5 and 4.6 of the decision:
"As an industrial jury, we have brought to this matter our own experience and knowledge. It is widespread and good industrial practice to adopt a flexible approach to grievance and disciplinary procedures in circumstances where the rigid application would result in hardship or potential unfairness. Where an employer knows that an employee is unable to meet with the person against whom the complaint is made, then arrangements will usually be made for the grievance to be heard by an independent person. If, as in this case, the person making the grievance has become ill as a result of that breakdown, then a good employer would not want to risk aggravating that illness by enforcing further confrontation between the parties. We do not criticise the respondent's procedures as such. We do, however, find that if an employer can reasonably foresee that the rigid application of those procedures will result in the mischief that Goold was directed at, then there is an obligation on the employer to modify those procedures to avoid that outcome. We are fortified in this assessment by the evidence of how similar situations had been dealt with by the respondent in the past. The members of the ONC advising Mrs Brown had thought that it was established practice to take a complaint involving a Regional Secretary directly to Stage 3. They said that this had been at the direction of a former General Secretary, John Edmonds. There was no evidence that this had been raised to the status of formal policy or a direction that this should always be done. Indeed we know that this was not always done. Mr Brennan told us that he had followed the procedure when he had pursued a grievance against his then Regional Secretary, Mr Curran. We are satisfied, however, that a situation must have arisen in the past where upon a proper and fair analysis of the facts a decision had been taken to amend the procedures in the interests of the person wishing to air a grievance. 4.6 Our conclusion is that the respondent did in the particular circumstances of this case, by its unreasonable unwillingness to assess the effect of its procedures on the Claimant and its unwillingness to relax those procedures so as to allow her to progress them beyond Stage 1, in effect prevented the Claimant from airing her grievance effectively and promptly. We find that this was a fundamental breach of contract entitling the Claimant to repudiate the contract."
The grounds of appeal[33]The grounds of appeal are directed at two findings of the Tribunal. First, it is said that the Tribunal erred in law in various ways in concluding in the circumstances that the employers had undermined trust and confidence in the employment relationship by insisting on compliance with the carefully framed grievance procedure adopted in the Dignity at Work document. The second ground of appeal is directed at the Tribunal's finding that the response of the Acting General Secretary was the last straw. Mr Segal submits that it was incapable of being so construed as a matter of law. We will deal with them separately. Undermining trust and confidence.[34]The duty not without reasonable and proper cause to undermine trust and confidence in the employment relationship is now well established: Malik v BCCI [1997] IRLR 462 . Both parties accepted that in the context of a complaint relating to the handling of a grievance the test we must apply for determining whether there was breach of the term of trust and confidence was that laid down by the EAT (Lady Smith presiding) in Abbey National plc v Fairbrother [2007] IRLR 320 . Lady Smith said (para 36):
"Accordingly, in a constructive dismissal case involving resignation in the context of a grievance procedure…. it seems to us that it is not only appropriate but necessary to ask whether the employer's conduct of the grievance procedure was within the band or range of reasonable responses to the grievance presented by the employee."
[35]Mr Segal advanced three arguments why the Tribunal erred in finding that this test is satisfied here. His primary argument was that the decision was perverse. He recognises the very high hurdle that he has to surmount in order to make good that ground, but he does not shrink from so doing. He submits that whilst other employers might have been willing to waive compliance with the first stage in that procedure, it could not be said to be unreasonable for an employer not to do so. This was particularly so given that the new Dignity of Work procedure was a negotiated agreement which specifically envisaged that the person raising a grievance of harassment would first have to do so with the alleged wrongdoer. Indeed it would severely undermine the efficacy of that procedure if the employee could simply avoid pursuing the grievance at stage one on the grounds that it involved such a step. The Tribunal have in fact made the cardinal error of asking what they would have done rather than what a reasonable employer would have done. Furthermore, whilst it might be said that any meeting between Mr Brennan and the Claimant over her future job duties might have been futile, that could not be said in relation to the wider harassment claims, which had never been put face to face with Mr Brennan.[36]This perversity ground was supplemented by two further arguments. The first was that the Tribunal did not in terms direct itself by asking whether the conduct of the employer fell within the range of reasonable responses. This argument was pursued orally but did not figure in the original grounds of appeal. The second again raised for the first time in the hearing and it seems not below, was that applying fundamental contractual principles it was simply not open to the Tribunal to find that there was a breach of the implied term of trust and confidence in circumstances where the employer was insisting upon compliance with the express term. An implied term can supplement an express term, or regulate the exercise of contractual discretions, but it cannot simply replace an express term. Mr Segal relied on simple principle rather than any specific authorities.[37]We reject each of these submissions. It is true that the Tribunal did not, in terms, direct itself by asking whether the conduct was in the band of reasonable responses, perhaps because the decision predated the Abbey National case. But we accept the submission of Mr Sweeney that it is plain from paragraph 4.5 of the decision, which we have set out above, that this is in essence how the Tribunal approached the matter. When the Tribunal talks about a good employer not seeking further confrontation where the effect would be to aggravate the employee's illness, we think they plainly have in mind what a reasonable employer would do in those circumstances.[38]We also reject this submission that the dismissal was perverse. The Tribunal made a finding on the particular facts of this case that it was unreasonable for the employer to insist on the Claimant having to meet Mr Brennan. Mr Sweeney submits, and we agree, that this was a finding open to the Tribunal. We recognise some force in Mr Segal's argument, but we are unanimously of the view that the conclusion is not so outrageous that we can properly characterise it as perverse as that test has been laid down in such cases as Crofton v Yeboah .[39]Other tribunals may have taken a different view of the employer's conduct but that is not to the point. The key issue here is the Tribunal's finding that Mr Brennan knew that any further meetings with him would be likely further to damage the Claimant's health. It was in those special circumstances that they found that it was unreasonable for any reasonable employer to insist upon full compliance with the grievance procedure[40]As to the argument that the Tribunal was not entitled to find a breach of an implied term where the employer was insisting upon compliance with an express term, we have some reservations about that argument being advanced for the first time before us. In any event, we do not accept that it is correct. We see no reason in principle why it should not be a breach of the duty of trust and confidence to insist upon compliance with the express terms of the contract, albeit only in exceptional circumstances.[41]The trust and confidence term has an important role in regulating the exercise of apparently unfettered express powers. Indeed, Mr Segal accepted that in very exceptional circumstances, such as where the evidence was that a face to face meeting would be seriously psychologically damaging, it would be open to a tribunal to find a breach of the duty. It seems to us that this concession defeats this argument. It is not the principle which is then in issue but rather whether the circumstances demand modification in the particular case, and that leads back to the perversity argument which we have rejected.[42]We also note that in Johnson v Unisys Ltd [2001] ICR 480 both Lord Hoffmann (para 45) and Lord Millett (para 77) accepted that it was in principle possible to subject an apparently unfettered express term - in that case a right to dismiss on notice but without cause - to an implied term to act fairly and in good faith. This did not involve an implied term contradicting an express term.[43]Finally, Mr Segal also put some emphasis on the fact that the Tribunal had unfairly and improperly placed emphasis on the fact there was evidence that the union had on an earlier occasion allowed a harassment case to go straight to the final stage without involving the alleged wrongdoer. Mr Segal says that it was precisely this case which caused the adoption of the Dignity at Work proposals, and that in any event the circumstances were different. However, the Tribunal was only relying on this for the purpose of showing that the union had in the past recognised that procedures should be amended to meet the particular problems faced by the party raising the grievance. The limited reliance on this earlier case does not demonstrate any error of law. The last straw.[44]The legal test for determining whether conduct is capable of amounting to the last straw in a pattern of conduct was propounded in the following terms by Dyson LJ in Omilaju v Waltham Forest LBC [2005] ICR 481 at paras 19-22, with whose judgment May and Wall LJJ agreed:
"19. The question specifically raised by this appeal is: what is the necessary quality of a final straw if it is to be successfully relied on by the employee as a repudiation of the contract? When Glidewell LJ said that it need not itself be a breach of contract, he must have had in mind, amongst others, the kind of case mentioned in Woods at p 671F-G where Browne-Wilkinson J referred to the employer who, stopping short of a breach of contract, "squeezes out" an employee by making the employee's life so uncomfortable that he resigns. A final straw, not itself a breach of contract, may result in a breach of the implied term of trust and confidence. The quality that the final straw must have is that it should be an act in a series whose cumulative effect is to amount to a breach of the implied term. I do not use the phrase "an act in a series" in a precise or technical sense. The act does not have to be of the same character as the earlier acts. Its essential quality is that, when taken in conjunction with the earlier acts on which the employee relies, it amounts to a breach of the implied term of trust and confidence. It must contribute something to that breach, although what it adds may be relatively insignificant. 20. I see no need to characterise the final straw as "unreasonable" or "blameworthy" conduct. It may be true that an act which is the last in a series of acts which, taken together, amounts to a breach of the implied term of trust and confidence will usually be unreasonable and, perhaps, even blameworthy. But, viewed in isolation, the final straw may not always be unreasonable, still less blameworthy. Nor do I see any reason why it should be. The only question is whether the final straw is the last in a series of acts or incidents which cumulatively amount to a repudiation of the contract by the employer. The last straw must contribute, however slightly, to the breach of the implied term of trust and confidence. Some unreasonable behaviour may be so unrelated to the obligation of trust and confidence that it lacks the essential quality to which I have referred. 21. If the final straw is not capable of contributing to a series of earlier acts which cumulatively amount to a breach of the implied term of trust and confidence, there is no need to examine the earlier history to see whether the alleged final straw does in fact have that effect. Suppose that an employer has committed a series of acts which amount to a breach of the implied term of trust and confidence, but the employee does not resign his employment. Instead, he soldiers on and affirms the contract. He cannot subsequently rely on these acts to justify a constructive dismissal unless he can point to a later act which enables him to do so. If the later act on which he seeks to rely is entirely innocuous, it is not necessary to examine the earlier conduct in order to determine that the later act does not permit the employee to invoke the final straw principle. 22. Moreover, an entirely innocuous act on the part of the employer cannot be a final straw, even if the employee genuinely, but mistakenly, interprets the act as hurtful and destructive of his trust and confidence in his employer. The test of whether the employee's trust and confidence has been undermined is objective (see the fourth proposition in para 14 above)."
[45]Mr Segal submits that if one considers what was relied upon as the last straw here, namely the conduct of Mr Kenny, the Acting General Secretary, was not only perfectly reasonable and sensible, but it did not in any way contribute to the undermining of trust and confidence. He had simply recommended that the Claimant should explore with Mr Brennan a possible resolution of her grievance. At that stage Mr Brennan was still anticipating that she would respond to him following the meeting between Mr Brennan and Mr King. He was not in fact insisting that the Claimant should personally meet Mr Brennan. Mr Mendelsohn had earlier indicated that she should do so, but that was not the position which Mr Kenny had adopted.[46]We note that following the approach of Lord Justice Dyson, it is not necessary that the last straw must itself be unreasonable conduct, let alone conduct constituting a breach of contract. The only issue here is whether it was open to the Tribunal to say that it contributed in some way - and it may be a very minor way - to the undermining of trust and confidence. We think that the Tribunal was entitled to find that it did. Mr King wrote to Mr Kenny in the hope that a direct meeting might resolve what had become an intractable problem. His unwillingness to be involved at least at that stage, albeit an understandable response and one which we suspect many in his position would have adopted, nonetheless added to the Claimant's grievance in the sense that it was not rescuing her from a position where she was being effectively compelled to seek to resolve her grievance, at least initially, with Mr Brennan. Putting it at its lowest, her principal concern was no nearer resolution. The Tribunal was entitled to conclude that objectively viewed in the context of the pattern of earlier conduct, this was not a wholly innocuous or immaterial act.[47]For these reasons, therefore, we dismiss the appeal on liability. The remedies' decision[48]We now turn to consider the decision on remedies. The Tribunal assessed the compensation at £40,883.63. They first found applying what is conventionally called the Polkey analysis that had the grievance been properly handled then there was a 50% chance that it would have had a successful outcome as far as Ms Brown was concerned. It was common ground that if that were the result and she were to have her political duties restored to her, then she would have returned to work.[49]Moreover, the Tribunal held that a reasonable implementation of the grievance procedure would have been completed in time for Mrs Brown to return to work on 20 May 2005 which was the date of her resignation. At that time she was off work and not in receipt of pay because she had exhausted her sick pay entitlement. However, the Tribunal held that the compensation should be awarded as from that date on the grounds that had there been no breach of contract, she would certainly have re-commenced paid employment from that date.[50]The Tribunal in its assessment of future loss heard evidence from the Claimant. She had by the time of the hearing obtained alternative employment, albeit at a lower salary. She told the Tribunal that it would take her two to three years to obtain certain teaching qualifications which she was pursuing. The Tribunal concluded that it would "take at least three years" before she would have the necessary skills' qualification and experience to earn an equivalent salary. They then added this:
"We have not taken into account potential salary increases in the calculation of future loss, nor have we made a deduction in respect of advanced payment. We have assumed that the two would cancel each other out."
[51]They dealt with various other matters which are not the subject of any complaint.[52]Mr Segal makes four separate complaints with regard to this part of the decision. First, he contends that the 50% assessment of deduction on Polkey grounds was perverse. He submits that it was simply impossible on the evidence for the Tribunal properly to conclude that the prospect of the grievance succeeding was that high. He says that the evidence plainly demonstrated that the political functions which the Claimant had originally carried out had been downgraded and it would have required the recruitment of at least one additional member of staff if she were to have that function restored to her. Given the financial difficulties which the union was facing, this was not a practical outcome. Furthermore, to say that there was a 50 per cent chance of success in the grievance did not mean that it was necessarily on the key question whether she would succeed in having the political duties restored to her.[53]Mr Sweeney contends that this was a finding open to the Tribunal. The Tribunal was simply not in a position to assess whether the grievance would succeed or not and they had to make some rough and ready assessment of the chance. They heard evidence from Mr Brennan that it was highly unlikely to succeed, but they were sceptical of his evidence, as they were entitled to be in the circumstances. Indeed, Mr Sweeney submits that the Tribunal's approach was if anything favourable to the union on two grounds. First, the evidence of what might have happened had the grievance been heard was in fact so slender that the Tribunal could well have found that this was one of those exceptional cases where the Tribunal could properly conclude that the exercise was simply too speculative and they were not in a position to make any assessment, and therefore no reduction, at all: see the observations of the EAT in Software 2000 Ltd v Andrews [2007] IRLR 568 para 54(3). Second, there was evidence from the Claimant that even if her grievance had failed, she would have accepted that she would have to carry on the recruitment job. The Tribunal does not seem to have addressed that possibility. Mr Sweeney did not raise these as errors of law, but merely to show that the Tribunal's approach could not fairly be characterised as improper or unjust towards the union.[54]In our judgment, the Tribunal was entitled to reach the conclusion it did. It is not obvious to us that restoring the political duties to the Claimant, had that occurred, would necessarily have involved recruiting additional staff. Certainly there was no express finding to that effect. Given the lack of any evidence about the likely outcome, the Tribunal was forced to speculate on the basis of little evidence if it were to make any reduction at all. Moreover, in our judgment when the Tribunal said that they recognised that the decision could go either way, they were focussing upon the chance that her political functions might be restored to her. That was what the grievance was principally about. We do not think the union begins to meet the high hurdle of demonstrating that this was a perverse determination.[55]The second ground is directed to the finding that compensation should start to run from 20 May 2005, the date of the resignation. The Tribunal took this as the appropriate date for the purposes of assessing future loss on the premise that had there been no breach of the duty of trust and confidence, the Claimant would have returned to work by then.[56]Mr Sweeney submits that the Tribunal was entitled to adopt the approach it did, although he does accept that the effect is to award damages for the breach of contract. He recognises that those damages cannot be awarded prior to the dismissal itself since they cannot then be losses arising out of the dismissal. However, he submits that the Tribunal could lawfully award compensation as from the date of dismissal without infringing any legal principle.[57]He drew our attention to the decision of the EAT (HH Judge Clark presiding) in GAB Robbins (UK) Ltd v Gillian Triggs UKEAT/621/06. In that case the employer was found to have infringed the implied term of trust and confidence which caused the employee to be ill from September 2004. She resigned and successfully claimed unfair dismissal in February 2005. The employers submitted that in assessing compensation it was inappropriate to make any calculation for the period post dismissal. Her loss of earnings flowed from the incapacity to work, a matter which predated, and was therefore independent of, the dismissal. The employee contended that in a case of constructive, as opposed to actual dismissal, damages can be awarded for all losses flowing from the repudiatory conduct which arise following the dismissal, even if not triggered by the dismissal itself. The Tribunal accepted the latter argument and the EAT dismissed the employer's appeal. The EAT took the view that the case of Johnson v Unisys Ltd . [2001] ICR 480 (which we consider below) had carved out an exclusion area wherein no common law contract claims can be pursued where there is an unfair dismissal claim The EAT held that this was such an area; in the case of constructive dismissal, unlike actual dismissal, there can be no separate common law claim for damages where the employee sues for unfair dismissal following acceptance of a repudiatory breach. The corollary of that, said the EAT, was that "the employee does have a claim for consequential loss in his unfair dismissal claim".[58]Mr Segal submits that the analysis of the Tribunal is flawed on a number of counts. First, they made no clear finding that the sickness resulted from the breach of contract, as opposed to the stress that was caused to the Claimant as a result of the meetings with Mr Brennan. This had occurred prior to her request that she move straight to the final stage of the grievance procedure, and the Tribunal had simply not focused upon whether her illness flowed from the breach at all. In any event, he submits that if there were an earlier breach, any damage clearly flowed from that earlier breach and not from the dismissal itself. That is demonstrated by the simple fact that the Tribunal found that, had the employer followed the grievance properly then the Claimant would already have been restored to work prior to the dismissal. It was therefore impossible to say that the damage resulted from the dismissal itself. Finally, he submits that the Triggs case was either wrongly decided or was in any event not applicable in the circumstances of this case.[59]The issue to be resolved here raises the vexed question of the relationship between a contractual claim for breach of the term of trust and confidence and an unfair dismissal claim. This has been considered in two decisions of the House of Lords. In Johnson v Unisys Ltd the House of Lords, by a majority (Lords Bingham, Nicholls, Hoffmann and Millett; Lord Steyn dissenting) held that a Claimant could not recover damages for breach of the term of trust and confidence where that breach stemmed from the manner of his dismissal. They concluded that the County Court judge had been right to strike out the claim. Their Lordships held that a common law contractual right embracing the manner in which an employee is dismissed cannot co-exist with the statutory right to unfair dismissal.[60]In the subsequent case of Eastwood v Magnox Electric plc (which was heard together with McCabe v Cornwall County Council ) [2004] ICR 1064 , the House of Lords was faced with two claims where the damage had allegedly been caused to an employee from a breach of the term of trust and confidence which had resulted from conduct predating the dismissal. In each case their Lordships held that in such circumstances the Claimants could pursue their contractual claim and were not bound by the exception identified in the Johnson case. Lord Nicholls, with whose judgment Lords Hoffman, Lord Rodger of Earlsferry and Lord Browne of Eaton-under-Heywood concurred, identified the scope of the exclusion in the following terms (para 27):
"Identifying the boundary of the 'Johnson exclusion area', as it has been called, is comparatively straightforward. The statutory code provides remedies for infringement of the statutory right not to be dismissed unfairly. An employee's remedy for unfair dismissal, whether actual or constructive, is the remedy provided by statute. If before his dismissal, whether actual or constructive, an employee has acquired a cause of action at law, for breach of contract or otherwise, that cause of action remains unimpaired by his subsequent unfair dismissal and the statutory rights flowing therefrom. By definition, in law such a cause of action exists independently of the dismissal."
[61]He then dealt specifically with the problems that might arise in a constructive dismissal case in the following way (para 31):
"Second, the existence of this boundary line means that in some cases a continuing course of conduct, typically a disciplinary process followed by dismissal, may have to be chopped artificially into separate pieces. In cases of constructive dismissal a distinction will have to be drawn between loss flowing from antecedent breaches of the trust and confidence term and loss flowing from the employee's acceptance of these breaches as a repudiation of the contract. The loss flowing from the impugned conduct taking place before actual or constructive dismissal lies outside the Johnson exclusion area, the loss flowing from the dismissal itself is within that area. In some cases this legalistic distinction may give rise to difficult questions of causation in cases such as those now before the House, where financial loss is claimed as the consequence of psychiatric illness said to have been brought on by the employer's conduct before the employee was dismissed. Judges and tribunals, faced perhaps with conflicting medical evidence, may have to decide whether the fact of dismissal was really the last straw which proved too much for the employee, or whether the onset of the illness occurred even before he was dismissed. "
[62]This demonstrates that where the damage flows from conduct which preceded the dismissal, it is recoverable for breach of the trust and confidence term rather than falling under the auspices of the unfair dismissal claim.[63]In our judgment, the union's submission is correct on this point. We agree that there has not, in fact, been a determination by the Tribunal as to whether the sickness was the consequence of the breach of contract, no doubt because the issue was not squarely raised before them. In any event, we are satisfied that the loss flowing from the failure to work immediately following the resignation did not stem from the dismissal itself. It was the consequence of conduct which preceded the dismissal. It could not even be said to have stemmed from the act which triggered the resignation in this case, namely, the response of the acting general secretary, Mr Kenny, to the overture for a meeting. Applying the approach set out by Lord Nicholls at para 31 of the Eastwood decision, we are satisfied that even if some breach had been identified which caused the sickness, the loss consequential upon that did not flow from the dismissal.[64]In Triggs the EAT took the view that, on the facts of that case, the situation fell firmly within the scope of the Johnson exception. (The Tribunal appears to have been influenced by some observations of Lord Steyn in para 40 of Magnox which do indeed suggest that the Johnson exclusion zone comes into play in a constructive dismissal case once a repudiatory breach has been accepted. If that is what Lord Steyn meant, we would respectfully suggest that these observations are not consistent with the approach of the majority).[65]In any event, we are satisfied that, whatever the precise nature of the circumstances in the Triggs case, this is not a case where the Johnson exception applies. This means both that the Claimant could, in principle, seek to recover losses arising from her sickness by a contractual claim, but also that she cannot seek to recover those damages through her complaint of unfair dismissal.[66]The parties have agreed that on the assumption that the union were right on this point the compensation should be reduced by the figure of £4,664.70. Accordingly, we reduce the compensation by that amount.[67]The third and fourth grounds of appeal relate to the assessment of future loss. Mr Segal submits that three years was simply too long. The original schedule of loss only identified two years and it was quite unreasonable for the Tribunal to assume that there would be a continuing loss for three years.[68]It was perhaps on the face of it a generous finding, but there plainly was evidence which could sustain it. That was the Claimant's own evidence that it might take her three years to obtain the teaching qualifications which would enable her to work on a job with a similar salary. It cannot be said that the conclusion is perverse in the light of that evidence, which the Tribunal accepted.[69]The related point is this. Mr Segal says that the Tribunal ought to have made an allowance for accelerated payments. The Tribunal chose not to do that because any loss could be set off against the increase in salary, which the Tribunal also did not bring specifically into the equation. Mr Segal submits that this was wrong. The increase in salary over the three year period would apply both to the original job and the one she had taken and therefore these would cancel each other out, but that meant that there was a failure properly to take into consideration the accelerated payment.[70]Mr Sweeney accepts the Tribunal's observations on this point, reproduced at para 46 above, are somewhat cryptic. However, he submits that the Tribunal is saying that the increase she would have obtained in the job with the union should be set off against the increase in the job subsequently obtained together with the benefit from accelerated payment. We think that the decision is sustainable on that basis. Any increases would not necessarily cancel each other out if they were, for example, similar percentage increases but relating to salaries at a different level. There would be an additional loss to the Claimant arising from the fact that the income in the new job is lower. The decision to equate that loss with the benefit of accelerated payment is no doubt a rough and ready one, but we do not think it amounts to an error of law.[71]There was a further point that Mr Segal ran before us, which is that the Tribunal ought to have recognised that the likelihood was that the Claimant would reach the equivalent salary by narrowing the gap over the three-year period. They calculated the compensation on the assumption that she would move from a lower to a higher salary in one go. However, this does not seem to have been a point that was raised before the Tribunal, and the only evidence in support of it appears to have been her evidence that the job she subsequently obtained had better prospects than other jobs she had been considering. That is not a basis for saying that she would necessarily have been promoted within the three year period. We do not think in the circumstances that any error of law in this regard has been identified. Conclusion[72]We dismiss the appeal on liability but uphold in part the appeal on remedies. We find that the compensation has been assessed too high. It should be reduced to take into account the period following 20 May before the Claimant would have been in a position to return to work because of her illness. Her losses during that period did not stem from the dismissal. By agreement between the parties, this requires a reduction in the compensation awarded by the Tribunal of £4,664.70. To that extent only, this appeal succeeds.