UK: Constructive Unfair Dismissal: Breach of Implied Term of Trust and Confidence
Authors: Frances Ross and Corinna Harris
An employment tribunal has ruled that an employee was constructively dismissed after their perceived demotion.
Mr Walker was branch manager at estate agency Robsons from 2017. In 2022 he was moved to a different branch but was asked to move back the following year following his replacement’s resignation. The sales director decided Mr Walker would share the branch manager role with a more junior colleague but had not discussed this with him. On his return, he discovered that this colleague had taken the “back desk” which was traditionally reserved for the branch manager and Mr Walker was assigned the “middle desk” which he interpreted as a demotion to assistant manager status. After a heated argument with the director, he resigned and claimed constructive unfair dismissal.
A tribunal concluded that the desk move, which was perceived as a demotion, and incidents of poor communication, in particular the failure to inform Mr Walker that he would share the branch manager role, was conduct that was likely to destroy or seriously damage the relationship of trust and confidence. It was found that Robsons had breached the implied term of trust and confidence and that Mr Walker was constructively dismissed.
Key Action Points for Human Resources and In-house Counsel
Where a demotion, such as a change in an employee’s status or responsibilities, occurs without their consent or the contractual right to impose it, the employee may resign and bring a constructive dismissal claim.
This case is a reminder to employers of the importance of good communication with employees, and ensuring they are informed about changes that impact their role.
