David Reade QC and Nicholas Siddall Succeed in an Important Appeal Addressing Affirmation of Breaches in ‘Last Straw’ Constructive Dismissals

David Reade QC and Nicholas Siddall successfully appeared in the matter of Kaur v Leeds Teaching Hospitals NHS Trust before the Court of Appeal (Underhill and Singh LJJ) judgment in which has been handed down today. CLICK HERE for the judgment.

The facts of the appeal addressed whether a strike out of a constructive dismissal claim was merited in the context of the Appellant complaining as regards a disciplinary process with which she did not agree. However the wider importance of the judgment is seen in its analysis of the correct approach to the concept of affirmation in the context of an alleged ‘last straw’ constructive dismissal.

Tension as to the ‘Last Straw’ Doctrine

Prior to the appeal there was a tension at EAT level as regards the approach to affirmation in this context. Lewis J sitting in the EAT in Addenbrooke v Princess Alexandra Hospital NHS Trust [2014] UKEAT 0265/14/0212 had held that non-repudiatory conduct post affirmation was capable of ‘reviving’ affirmed breaches in the context of a ‘last straw’ dismissal. By contrast HHJ Hand QC in Vairea v Reed Business Information Ltd [2016] UKEAT 0177/15/0306 had held that such an approach was impermissible in law and ignored the traditional contractual approach to affirmation. In Pets At Home Ltd v MacKenzie [2018] UKEAT 0146/17/1501 HHJ Eady QC had followed the Vairea approach.

The Court of Appeal judgment in Kaur addressed which of the conflicting approaches reflected the correct position in law.

Review of the Last Straw Doctrine

In a characteristically illuminating judgment Underhill LJ (with whom Singh LJ agreed) reviewed the history of the last straw doctrine and its jurisprudential purpose. In so doing he made the following general observations (paragraphs 42-6)

• The last straw doctrine is only relevant in circumstances where the Claimant seeks to rely on a cumulative breach and not a ‘one off’ serious breach of contract;
• That the concept of affirmation is not here relevant from the first point that the conduct of the employer crosses “the Malik threshold” (i.e. is sufficiently serious to amount to repudiation) if the conduct of the employer continues;
• In context it would be extraordinary if the employee did not object at the point that the employer’s conduct first crosses the Malik threshold that they then lost the right to rely on the same thereafter. Such a situation was viewed as being unfair and unworkable;
• The ‘last straw’ doctrine envisages two scenaria which are (i) when the conduct of the employer had not crossed the Malik threshold prior to the final straw and (ii) where it has crossed that threshold but the last straw revives the employee’s ability to rely on the earlier conduct;
• Where the last straw is of sufficient gravity to amount to a breach in and of itself then the earlier conduct of the employer and employee is irrelevant.

Addenbrooke Preferred

Underhill LJ adopted the analysis of Lewis J in Addenbrooke and stated as follows:

General Guidance

Underhill LJ stated (paragraph 52) that Vairea should be put to one side and that Employment Tribunals should seek to draw from the “pure well” of Dyson LJ’s judgment in Omilaju. He however recognised that facets of the judgment could be seen to complicate the law in this area. For that reason he summarised the principles to be applied (in a manner likely oft to be repeated by Employment Tribunals) as follows:

1. What was the most recent act (or omission) on the part of the employer which the employee says caused, or triggered, his or her resignation?
2. Has he or she affirmed the contract since that act?
3. Was that act (or omission) by itself a repudiatory breach of contract?
4. If not, was it nevertheless a part (applying the approach explained in Omilaju) of a course of conduct comprising several acts and omissions which, viewed cumulatively, amounted to a (repudiatory) breach of the Malik term? (If it was, there is no need for any separate consideration of a possible previous affirmation, for the reason given at the end of a.     para. 45 above.)
5. Did the employee resign in response (or partly in response) to that breach?

None of those questions is conceptually problematic, though of course answering them in the circumstances of a particular case may not be easy. 

Subsidiary Points

In the context of the appeal in Kaur an issue was whether the Claimant had arguably affirmed any previous breach occasioned by the conduct of the disciplinary process by appealing against the outcome. Underhill LJ rejected the suggestion that this could amount to affirmation as follows:

Conclusion

The judgment of the Court of Appeal brings much welcome clarity in this area and resolves an unhelpful divergence at EAT level. However conceptual concerns remain. On the logic of Underhill LJ’s analysis an employee whom faced repudiatory conduct many years before could seek to rely on the same in support of a claim of constructive dismissal in the presence of a timeous resignation in response to a more than merely innocuous last straw. That presents the prospect of a lengthy and potentially arid trawl through the history of the employment relationship, even if one has refreshed oneself  from the clear well of Dyson’s Judgment. This may require robust case management to prevent hearings on constructive unfair dismissal becoming disproportionality lengthy.

David Reade QC and Nicholas Siddall were instructed by Suzanne Nulty and Philip Farrar of Hill Dickinson LLP, Liverpool.