Appeal No. UKEAT/0066/08/BI

EMPLOYMENT APPEAL TRIBUNAL
52 MELVILLE STREET, EDINBURGH, EH3 7HF

	At the Tribunal
	On 22 April 2009

Before
THE HONOURABLE LADY SMITH
MISS J GASKELL
MISS A MARTIN

WISHAW AND DISTRICT HOUSING ASSOCIATION	APPELLANT

MR G MONCRIEFF	RESPONDENT

Transcript of Proceedings

JUDGMENT

APPEARANCES

For the Appellant	MR D O’CARROLL
(Advocate)
Instructed by:
Law at Work
151 St Vincent Street
Glasgow G2 5NJ	
For the Respondent	MR A HARDMAN
(Advocate)
Instructed by:
Ian Smith Watson Solicitors (Scotland) Ltd
10 Park Road
Kelvinbridge
Glasgow G4 9JG

SUMMARY

Constructive dismissal; last straw.  Tribunal failed to identify the last straw.  Neither of the potential “candidates” for last straw were capable of contributing to a series of earlier acts so as to amount, cumulatively, to a breach of the implied duty of trust and confidence.  Appeal allowed and claim dismissed. 

THE HONOURABLE LADY SMITH
INTRODUCTION
1.	This is an appeal from a judgment of the Employment Tribunal sitting at Glasgow, Employment Judge Mrs J Cape, registered on 23 October 2008, finding that the claimant had been unfairly dismissed.  The claim was one of constructive dismissal.  The claimant’s case was that he had resigned because of a series of failures by the respondents; his was the type of case which is commonly referred to as a “last straw” case. 

2.	We will continue to refer to parties as claimant and respondents.

3.	The claimant was represented by Mr Cox, solicitor before the Tribunal and by Mr Hardman, Advocate, before us.  The respondents were represented by Mr R Woods, solicitor, before the Tribunal and by Mr D O’Carroll, Advocate, before us.

BACKGROUND
4.	The respondents provide housing in the Wishaw area.  They have about 25 employees.  The claimant was employed by the respondents as a Property Services Officer and his duties involved property inspection, carrying out routine maintenance work and dealing with external contractors.  

5.	On 25 May 2006, the claimant was called to a counselling interview with the Maintenance Manager, who was his line manager and the Technical Services Manager.  It was an informal meeting at which he was advised of thirteen areas of concern regarding the quality of the performance by him of his duties.  He was told that the interview was the precursor to a formal disciplinary interview and that the status quo could not continue.  On 2 June 2006, he was issued with a copy of the notes of the counselling meeting.  Receipt of the notes precipitated what the Tribunal refers to as “an overwhelming depression” (paragraph 21).  That was in circumstances where, in the preceding year, he had suffered personal difficulties in respect that his daughter had suffered a miscarriage, his brother had attempted suicide, his mother had suffered a stroke and her health was failing.  He became unfit for work and did not attend work on 5 June 2006.

6.	The claimant did not return to work after that.  A series of exchanges took place between the claimant’s wife and the respondents, between the claimant and the respondents and between the claimant’s solicitor and the respondents/their solicitor. 

7.	Shortly put, the respondents’ Chief Executive, Mrs Cooper, was sceptical about whether or not the claimant’s sickness absence, following as it did upon the counselling interview and the notes of it being issued to him, was a genuine one.  His wife went to see the respondents’ Mrs McKenna and explained to her that the claimant was unwell due to the family problems to which we have referred.  In the course of subsequent correspondence, Mrs Cooper referred to the claimant having declined to return calls made to him, which was not correct.  The claimant was upset by that.  She referred him to Occupational Health and in her letter of referral, which was copied to the claimant, stated that he had declined to speak to them but that his wife had told them that his anxieties were due to family problems.  She also stated that they had discovered that the three family issues mentioned by his wife were well known in the office, adding that his brother was back at work.  The claimant was upset at the reference to his brother;  he, as he stated in a letter to the respondents dated 29 July 2006, considered that someone had lied to Mrs Cooper about him speaking openly about his brother and he sought details as to who it was and in what circumstances she had got the information.  Mrs Cooper took issue with the claimant’s assumption that someone had lied to her. 

8.	By letter dated 31 July 2006, the claimant wrote to the Technical Services Manager, taking issue with the procedure that had been followed at his counselling interview in May.  He attached an eight page detailed response to the various performance failures detailed at the interview and stated that he considered the accusations made about him were unfair and in some cases untrue.  By letter dated 7 August 2006, he wrote to Mrs Cooper with a copy of his response, stating that he did not believe he had had a fair hearing at that interview and asking her to look into the matter.  Further correspondence ensued, the details of most of which it is not necessary for us to rehearse.  The letters were productions before the Tribunal and before us and speak for themselves.  The tone of the Mrs Cooper’s letters was not conciliatory; the Tribunal referred to some as being peremptory and we can understand why.  

9.	So far as the claimant’s state of health was concerned, the Occupational Health Adviser reported to Mrs Cooper by a report dated 4 August and letter dated 9 August received by her at some point prior to 18 September 2006, that the claimant’s GP considered he should stay off work due to problems with poor concentration and anxiety, that he had been prescribed anti‑depressant medication and that it was expected that he would be fit to return to work within 2 – 3 months.  Later in the year, on 11 December, the respondents’ solicitor received a copy of a GP report dated 10 November which stated that the claimant was suffering from an episode of anxiety/depression, that his health problems were precipitated by stressful events within the family, that progress was slow but that the GP anticipated full recovery with the claimant’s health returning to normal by early 2007.  In the meantime it would not be advisable for the claimant to attend meetings with his employers. 

10.	By 21 September 2006, the claimant had instructed solicitors to act for him and all further correspondence and communication between him and the respondents was through those solicitors.  In the absence of any finding by the Tribunal that the claimant had sight of the respondents’ letters thereafter, we cannot conclude that he did although it can be inferred that his solicitor had spoken to him and taken instructions from him regarding what, at least, they considered was the import of them.  By letter of 21 September 2006, the claimant’s solicitor referred to channels of communication between the parties having been difficult and raised the possibility of “the matter” being referred to an independent party by way of arbitration.  There were, by that stage, different “matters” as between the parties.  In particular, there was the matter of the quality of the claimant’s performance of his duties.  There was also his upset regarding the suggestion that he had talked openly about his brother’s attempted suicide and his allegation that someone must have lied to Mrs Cooper.  The possibility of a reference to ACAS was explored in correspondence thereafter. 

11.	In the event, there was no reference to ACAS and the claimant resigned by letter dated 9 January 2007.  

RELEVANT LAW
12.	Parties were agreed that this was a “last straw” case and that, accordingly, the summary of the applicable principles set out in the case of Omilaju v Waltham Forest LBC [2005] ICR 481 required to be borne in mind.  In particular, the reference in it to the judgment of Glidewell LJ in Lewis v Motorworld Garages Ltd [1986] ICR 157 at p.169 is relevant:

“(3)  The breach of this implied obligation of trust and confidence may consist of a series of actions on the part of the employer which cumulatively amount to a breach of the term, though each individual incident may not do so.  In particular in such a case the last action of the employer which leads to the employee leaving need not itself be a breach of contract;  the question is, does the cumulative series of acts taken together amount to a breach of the implied term? (see Woods v WM Car Services (Peterborough) Ltd 1981 ICR 666).  This is the ‘last straw’ situation.” 

as are certain of Dyson LJ’s observations at paragraphs 16,19,21 and 22:

“16.  Although the final straw may be relatively insignificant, it must not be utterly trivial: …
19.  …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?  …
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…  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 …
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. …
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.”  

13.	Thus, in any constructive dismissal case where the claimant founds on a series of acts and a “last straw”, a Tribunal requires to begin by identifying the “last straw” act.  It then requires to consider whether, assessing that act objectively, it is capable of contributing to a series of earlier acts so as to amount cumulatively to a breach of the implied term of trust and confidence.  If it concludes that the act does have that potential then it requires to consider the other acts in the series of acts and ask whether, looked at together, all the acts, including the “last straw” amount to a breach of the implied term.  

THE TRIBUNAL’S JUDGMENT
14.	When considering the Tribunal’s reasoning, the terms of five particular items of correspondence that passed between the claimant’s solicitor and the respondents/their solicitor require to be considered.  The first is a letter from the respondents to the claimant’s solicitor dated 3 November 2006:

“Dear Sirs
GEORGE MONCRIEFF – 134 CAMPBELL STREET, WISHAW
Thank you for your letter of 2 November 2006 in reply to my letter of 19 October.
I am prepared to agree to any concrete suggestion that might facilitate a resolution to our current circumstances and therefore I agree to the involvement of ACAS at a cost to us of £600.  However, please note that we cannot agree to an open ended sum or an open ended time commitment, but we are prepared to make all reasonable efforts.
I am not sure what remit you would like us to give to ACAS if it is not, as I thought from your correspondence, to review George’s performance issues – to mediate between our ‘positions’ seems a little vague.  As I understand it, George’s ‘position’ is that he is too ill to work or to meet with us for purely personal reasons, whereas ours is that our door remains open but that this can only be for so long given our business needs.
Accordingly, I shall require from you a proposed remit for the ‘mediation’ and in particular I require to know what the ‘outstanding issues’ are that you refer to, if they are not performance issues.
You have clearly made overtures to ACAS that are accepted by them (they told me that they would not become involved in personal performance ‘disputes’) so please ask your contact to contact me and I will make the appropriate arrangements.  Alternatively give me the details of your contact person/reference so that I can contact them directly.
I trust that you will do the above by return as my earlier requirements regarding return to work by 15 December still stand.  I note that the usual time for your replies is around 10 days and this is not in George’s interests.  If George has not returned to work by the date given then he will be asked to attend a hearing where his dismissal will be considered.
Yours faithfully
Signed
Anne Cooper
Chief Executive”

15.	The second is the claimant’s solicitors’ response of 15 November 2006, to that letter:

“Dear Madam,
GEORGE MONCRIEFF
134a CAMPBELL STREET, WISHAW
We refer to the above, and to your letter of 3 November.  With respect, the tone of certain parts of that letter are totally unnecessary and unhelpful.
We would remind you that George’s concerns here are not necessarily performance-related.  Rather, his concerns centre more on the overall handling of his case, from the time he was first involved in discussions with management.  That is certainly an issue which ACAS can and will become involved in, as the trust implicit in the employee-employer situation has broken down.  Particularly, as we have said previously, our client considers that – despite your apparent offers of open-door discussions here – your mind has clearly been made up at a far earlier stage regarding the truth or otherwise of the matters raised by George.
As far as outstanding issues are concerned, the preparation of a remit is, with the greatest of respect, a double-edged sword.  You should clearly be able to address what you consider to be the outstanding issues as far as you are concerned.  As far as George is concerned, he would then add what he feels are unresolved.
Any remit to ACAS MUST be a joint one, in the real sense of the meaning of that word.  We feel that, were these simply to be prepared by us, your attitude, as vouched by previous correspondence, would simply be to reject these, as not suitable to you.  Equally, it is not for you, in these circumstances, to make contact with ACAS direct – any remit should be prepared and sent by way of a joint covering letter, with no prior contact being made with any individual at ACAS, which could influence the terms of remit or the decision.
The cost for clarification, is actually £550 plus VAT per day, and obviously, the tighter the remit is drawn, the more the case will be focused, and the more likely we will be to achieve early and happy resolution.
Your continued insistence on your time-limit in the final paragraph of your letter is unnecessarily inflammatory.  Should this matter end up being resolved by other parties, then you will doubtless be aware of the interpretation we will be placing on that.
We await your further reply with interest.
WITHOUT PREJUDICE
Yours faithfully

Signed
Ballantyne & Copland
413”

16.	The third is a letter from the respondents’ solicitors to the claimant’s solicitor dated 11 December 2006:

“Dear Mr Cox
Wishaw & District HA
George Moncrieff

Thank you for your letter of 8 Dec with the attached letter from your client’s GP.
I note your position here.  As regards your client’s wish to seek an acceptance from my client that matters have been handled incorrectly here, I think that this is probably best dealt with by way of my client’s grievance process.  I note that your client’s doctor is of the view that your client is not fit to meet with my client as the present time.  Perhaps, once he is fit to meet with my client, a meeting can be held to discuss any issues that you client has in relation to his treatment and agree a way forward here.
I am not sure what matters your client is looking for my client to reconsider here (as per your last paragraph).  As things stand at the present time, your client remains absent from work for what seems to be non-work related reasons (at least according to the doctor’s report).  Your client does not wish to, or at least cannot, meet with my client at the present time.  It would nonetheless be useful if your client were able to give my client an indication of when he thinks he might be fit to return to work.  The doctor’s report seems to envisage a return to work early in the New Year.  Does this remain the case?  You will appreciate that, given the circumstances here and the length of your client’s absence, my client has concerns about his fitness to resume his former duties, and would wish some advance notice of when your client intends to return to work so that any necessary measures can be put in place to ensure that the work that your client return to is suitable for his current state of health.
I would appreciate it if you could come back to me on these points at your earliest convenience.
Yours sincerely,
Donald MacKinnon
Director of Legal Services
Law At Work”

17.	The fourth is the claimant’s solicitor’s letter to the respondents’ solicitor, dated 18 December 2006:

“Dear Sirs
OUR CLIENT:  GEORGE MONCRIEFF
YOUR CLIENT:  WISHAW AND DISTRICT HOUSING ASSOCIASTION LIMITED
We refer to the above and to previous correspondence.
We have spoken again with Mr Moncrieff, who has instructed us that, from the terms of your letter, it seems that there is no real progress being made here.
Accordingly, we are instructed not to correspond further with you at present as our client is considering his options in relation to this matter.
WITHOUT PREJUDICE.

Yours faithfully

Signed
Ballantyne & Copland
106	”

18.	The fifth is the claimant’s letter of resignation dated 9 January 2007:

“Dear Madam
I, George Moncrieff residing at 134 Campbell Street, Wishaw, do hereby intimate my wish to resign from my employment with Wishaw & District Housing Association Limited as Property Services Officer with effect from 9th February 2007.
The reason for my resignation is twofold:
(1)  in relation to investigations carried out following my alleged unsatisfactory performance of my duties, I was not treated fairly;
(2)  and to the intimidation, harassment and general unsatisfactory behaviour by both yourself and others of my colleagues, which contributed to my current sickness position.
I would be obliged if you would acknowledge receipt of this letter and let me have any further payments due to me as soon as possible.  For your information a copy of this letter has been sent to Law at Work.
Yours faithfully
GEORGE MONCRIEFF”

19.	On the findings of the Tribunal these exchanges with the claimant’s solicitor constitute the only communication between the respondents and the claimant in that period.  Indeed, there would appear to have been no direct communication between the claimant and the respondents since 7 August 2006. 

20.	Bearing in mind that the claimant’s was a “last straw” case, we turn to the Tribunal’s findings as to what specifically it was that caused the claimant to resign.  They are not entirely clear.  At paragraph 139 they state that the claimant having resigned in response to the claimant’s conduct towards them under reference to Mrs Cooper’s conduct in relation to his absence and return to work and to him being treated unfairly in relation to investigations about performance matters and the breach of confidentially regarding his brother’s situation.  There is no mention there made of any reaction on his part to what he learnt of the letter of 11 December.  Separately, at paragraph 105, the Tribunal state:

“105.  The Claimant had reached the position where his trust in the Respondent had broken down by 15 December 2006 when his solicitors wrote to the Respondent in such terms.  The Claimant hoped that there would be a referral to ACAS or other body which might restore the relationship.” 

21.	The reference to 15 December must, in error, be a reference to the letter of 15 November. 

22.	Then, at paragraph 106, they state:

“106.  He had been told that if he did not return to work by 15 December his employment would be terminated.  Four days before that deadline, a letter had been received from the Respondent’s consultants suggesting rather that the Claimant could go through the Respondent’s grievance process if he was unhappy.  So far as he was concerned, he was back to square one.  He concluded that the Respondent had no real intention of trying to resolve his concerns; it had been evident from the medical report that his health had been adversely affected by his communication with his employer.” 

23.	In passing we would comment that we do not consider that it was open to the Tribunal or to the claimant to approach matters on the basis that the claimant had simply been told that if he did not return to work by 15 December his employment would be terminated.  That gloss on what he had been advised of ignores the context, which, as is evident from the last paragraph of the letter of 3 November was that he was on sickness absence and the respondents put him on notice that if he had not become fit to work again by 15 December, a hearing would be fixed to consider whether or not he would, in those circumstances, be retained in the respondents’ employment.  There is nothing wrong or inappropriate in an employer seeking to address the question of whether or not the state of health of an employee who has been off sick for an extended period (the claimant would have been off work for almost six months by 15 December) ought to be dismissed on unfitness grounds and to indicate that that is going to happen is not to say that the outcome has been predetermined.  To interpret the letter as telling the claimant that he would definitely be dismissed if he had not returned to work by that date is not fair. 

24.	Then, at paragraph 156, the Tribunal state:

“156.  The Claimant intimated his resignation some three weeks or so after receipt of the letter from the Respondent’s consultants when it became evident to him that he was “back to square one.”   

25.	In these circumstances, the Tribunal may have determined that the claimant’s resignation was in response to the situation outlined in the letter of 3 November.  Alternatively, they may have determined that his resignation was in response to what he learnt of the letter of 11 December.  We can see that, on one view, the Tribunal must have intended to convey the latter; that would seem to be consistent with what they state at paragraph 156.  However, the references to the significance of the letter of 3 November and to the claimant’s resignation being in response to Mrs Cooper’s general conduct make it impossible to conclude what their finding was regarding what exactly constituted the ‘last straw’ in this case.  Indeed, the impression is rather that the Tribunal overlooked the need to identify the “last straw” and consider whether or not, viewed objectively, it was capable of contributing to a series of earlier acts so as to amount cumulatively to a breach of the implied term of trust and confidence (see:  Omilaju as discussed above). 

THE APPEAL
26.	Ultimately, the issue between the parties narrowed considerably.  Having considered the argument against him presented by Mr O ‘Carroll, Mr Hardman, for the claimant, accepted that the Tribunal’s judgment could not stand.  That was because they had not identified the last straw.  In those circumstances, there should, he submitted, be a remit.  The claimant’s evidence as to what it was required to be heard.  

27.	Mr O’Carroll’s clear and careful submissions were, however, not confined to the issue of whether or not the Tribunal had identified a last straw.  Mr O’Carroll submitted that, on their findings there were but two candidates (either the letter of 3 November or the letter of 11 December) and neither of these were capable of constituting a last straw.  He did not, accordingly, accept that Mr Hardman’s submission that the appropriate disposal was that there should be a remit, was well founded.  

28.	Regarding the letter of 3 November, he submitted that it was open and constructive.  There had been a proposal to refer matters to ACAS.  The letter dealt with that by seeking to clarify the remit of any such referral and future arrangements.  Whilst the final part of the letter referred to the possibility of dismissal in the context in which it did, that could not be breach of contract.  A decision that contractual proceedings would, if certain circumstances applied, follow at a future date was a statement of intention.  It was not a breach of contract.  

29.	Further, if the claimant did consider that the letter of 3 November was the last straw, he did not resign in response to it. 

30.	Regarding the letter of 11 December, it was entirely innocuous.  It was clear that the “deadline” of 15 December had been lifted in the light of the GP’s report that was received by the respondent’s agents that day.  All that was sought was an indication of when a return to work could be expected and there was a proposal that the claimant’s outstanding complaints be dealt with under the respondents’ grievance procedure.  The letter did not indicate that that was the only procedure the respondents were prepared to follow.  There was a general reference to agreeing “a way forward”. 

31.	Since neither of the letters could, when viewed objectively, be regarded as evidence of a “last straw” in Omilaju terms, there was no point in any remit.  The claimant’s subjective evidence on the matter could not alter that. 

DISCUSSION AND DECISION
32.	Counsel were agreed that the only candidates for the “last straw” were the two letters of 3 November and 11 December.  We are readily persuaded by Mr O’Carroll’s argument that neither letter, when viewed objectively, could be seen as amounting to a “last straw”.  The letter of 3 November related, for the most part, to the proposal to arrange a remit to ACAS and shows the respondents’ willingness for there to be such a remit.  As regards the last paragraph, we have already made observations about it.  We agree that it does not amount to a breach of contract.  Bearing in mind that a last straw does not, of itself, require to do so, we have considered whether that paragraph could, nonetheless qualify.  We do not, though, see that the fact that the respondents put the claimant on notice that they would follow what would have been a proper procedure in the light of the latter’s long term ill health absence could amount to a last straw.  It could be said that, in fairness to the claimant, they required to notify him that that was what they were intending.  We would also observe that the claimant and the Tribunal, in any event, misinterpreted the paragraph as saying that the claimant would be dismissed if he did not return to work by 15 December.  As was commented in paragraph 22 of Omilaju, an innocuous act of the employer does not become a last straw because the employee misinterprets it. 

33.	The claimant would, in any event, have a separate problem in respect that there is a cogent argument to the effect that even if he regarded the letter of 3 November as the last straw, he affirmed the contract through his solicitors because of the proposal to refer matters to ACAS with a view to his getting back to work having subsisted thereafter.  We do not require to express a view on that matter in the circumstances but it should be appreciated that it cannot be assumed that the claimant would have succeeded even if he could have established that the letter of 3 November was a last straw because the conclusion could well be that he had, nonetheless, affirmed his contract of employment. 

34.	As regards the letter of 11 December, we are at a loss to see how it could possibly be regarded as a “last straw”.  The letter is in appropriate and professional terms and seeks to explore what properly might be worked out as the next steps always bearing in mind that priority should be given to the claimant’s needs as dictated by his state of health.  We note that the claimant’s solicitor, in his letter of 18 December 2006, explains that it is his client who has instructed that the terms of the letter make it seem that there is no real progress being made, thereby creating the impression that the solicitor is, himself, distancing himself from that conclusion.  If that was what he was doing, then it was well done, in our view, since the letter, far from being indicative of a lack of progress, showed that the respondents were keen to make progress once the claimant was well enough. 

35.	In these circumstances, we accept Mr O’Carroll’s submission that there is no room for a remit here.  On no view could a Tribunal, on the facts of this case, conclude that there was a “last straw” and accordingly, the claimant’s claim of unfair constructive dismissal is bound to fail.

DISPOSAL
36.	In the circumstances, we will pronounce an order upholding the appeal and dismissing the claim.