Can a Historic Breach of Contract Be Used to Support a Claim of Constructive Dismissal?
The answer is "it depends". In a recent case, the tribunals confirmed that historic stand-alone breaches of contract could not be used to support a "final straw" argument, where the final straw on its own was not enough for the claim to succeed.
What Does the Law Say?
For an employee to claim constructive dismissal, they must show that there has been a breach of contract by the employer, which is serious enough to allow them to walk away and treat the contract as being at an end. Sometimes this will be a single significant act. On other occasions, the breach will be made up of a number of acts or events which individually may not be significant, but are significant when viewed as a whole.
The employee must also resign promptly in response to the alleged breach.
Where historic events are relied on, an employment tribunal must decide whether those events are part of a continuous series of acts linked to the final straw that caused the employee to resign, or whether they were stand-alone events which the employee chose to ignore and continue working.
Pets at Home Ltd v MacKenzie
Ms MacKenzie was an Assistant Manager. She had twice applied for a promotion with Pets at Home - first in February 2015, during her pregnancy, and second in January 2016, when she was on maternity leave. She was unsuccessful both times.
In March 2016, she heard the news that that a less experienced Assistant Manager had been successful in a further selection exercise for promotion. She said this was the final straw, resigned from her employment and lodged a claim for sex/pregnancy discrimination and constructive dismissal.
The Employment Tribunal found that the failures to promote Ms MacKenzie were acts of discrimination but were out of time. However, it upheld her claim for constructive dismissal on the grounds that the refusals to promote her were breaches of contract, and the appointment of the less experienced colleague was the final straw. Pets At Home appealed.
The Employment Appeal Tribunal's (EAT) Decision
Overturning the original decision, the EAT confirmed that the ET had failed to consider whether the earlier breaches of contract in February 2015 and January 2016 were part of a continuous act, or whether they were historic stand-alone breaches. The first had occurred over a year before her resignation, the second over three months before.
The EAT confirmed the existing legal position that a final straw cannot revive old breaches of contract where the employee has chosen to continue working. In legal speak, a final straw cannot revive an earlier breach of contract that has already been affirmed the employee.
What Does It Mean for Employers?
Although the case provides some reassurance that employers won't be caught out by historically affirmed breaches of contract, it's important for employers to bear in mind that the facts of this case are very specific.
Ms MacKenzie could not point to any continuing act prior to the alleged 'final straw'. There will be many constructive dismissal cases where older events are part of a continuing act and can be taken into account when assessing whether there has been a suitably serious breach of contract.