The decision of the Court of Appeal can be found here. The reasoning on the ‘curing the breach’ point is pretty much as argued in the appeal, which is set out in my previous post. On the ‘reasonable range of responses’ point, the approach of the Employment Appeal Tribunal has largely been upheld, but with a caveat, per Lord Justice Sedley, that, “It is nevertheless arguable, I would accept, that reasonableness is one of the tools in the employment tribunal’s factual analysis kit for deciding whether there has been a fundamental breach. There are likely to be cases in which it is useful.” It seems to follow that, while a tribunal does not have to direct itself to the reasonable range of responses, it equally does not err if it takes this into account in finding that there is no fundamental breach, as in Claridge v Daler Rowney.

Nor can a dismissal that arises from such a situation ever be fair, at least if one applies the reasoning in paragraph 47 that an employer cannot possibly justify an act which it denies has occurred. As I have never known an employer to admit to a breach of the implied term of trust and confidence, this means that there is little scope for defending a case once a breach of the term has been found. I think that this is entirely right both as a matter of legal certainty and of industrial reality but it does demonstrate the importance of having an approach to testing for a breach which is both consistent and open to scrutiny.

The problem is that whether or not there is a constructive dismissal is a matter of fact and is difficult to overturn on appeal. The aim of Abbey National v Fairbrother was to prevent such findings on whimsical grounds and, now Fairbrother has been overturned, it is unclear how a similarly questionable decision could be challenged. I would argue that this can be done by allowing the range of reasonable responses test to be be used as part of the ‘toolkit’ of the appellate courts. Even if a tribunal has directed itself correctly, an analysis based on reasonableness may lead to a conclusion that its decision is perverse.

I went to the Court of Appeal on Monday and I heard some fascinating arguments. It seems that the question of whether trust and confidence can be restored after being destroyed could become moot as, according to Robin White, for Professor Buckland, there is no authority for the more general proposition that a repudiatory breach of contract can be cured by the wrongdoer, as opposed to being affirmed by the wronged party. The authorities cited by Employment Appeal Tribunal apparently say no more than that an anticipatory breach can be remedied. Also, while an employee is entitled to give an employer a chance to make amends, without affirming the contract, there is no obligation to accept what is done.

There is also a problem with the finding that the Tribunal wrongly applied a subjective test in deciding whether the breach had been cured. It is difficult to comment without having seen the judgment but the submission by Robin White was that the Tribunal repeatedly said that Professor Buckland was “entitled” to be dissatisfied with the handling of his complaint, and so they had applied an objective test after all.

In an earlier post, I questioned whether it was possible for a dismissal brought about by a breach of the implied term to ever be fair but Lord Carnwath floated an interesting possibility in his discussions with counsel. If a repudiatory breach is incapable of being cured then it follows that events after the breach, but before the breach is accepted, cannot be considered in deciding whether an employee is entitled to resign. This means that, if these events can be taken into account in deciding whether the dismissal is fair, as permitted according to Savoia v Chiltern Herb Farms, then the two questions may well produce quite different answers. However the parties agreed that the decision in Berriman v Delabole Slate, in which the reason for the dismissal is defined as the reason for the repudiatory conduct, is regarded as being more orthodox, and it will be interesting to see if this idea makes its way into the final judgment.

The case of Eweida v British Airways concerns a Christian woman who was disciplined by her employer for wearing a cross, contrary to its dress code. Her claim has been rejected for the third time, this time by the Court of Appeal. The main point in the appeal is the suggestion by Karon Monaghan QC that a policy can give rise to indirect discrimination even if there is only one person put at a disadvantage as a result. Given the clear wording of the statute, the doubt expressed about this submission is no great surprise, despite an ingenious argument that the words ‘would put…at a disadvantage” means that a hypothetical group should be considered even where no such group exists. In any event, the majority goes on to hold that, if the case is put in this new way, any disadvantage would inevitably be justified.

I can confirm that Buckland will be heard at the Court of Appeal tomorrow. Interestingly, there is also a permissions hearing for a cross-appeal by the university so it looks as though the range of reasonable responses point willhave to be considered to some extent although, it has to be said, Fairbrother does not appear to be particularly helpful on the facts of this case. There is an enormous difference between remedying a flawed process with an appeal and trying to remedy a breach of trust with a grievance. It is for this reason that I strongly believe that the appeal by Professor Buckland also ought to succeed.

In a sense, it could be argued that the ameliorative effect of an appeal is an example of a breach of the implied term being fixed and it is, I have to accept, the most plausible contender. Disciplinary action short of dismissal following a shoddy process could give rise to a breach (though many tribunals would find that it does not) which could then be remedied on appeal. This has the unfortunate effect that an employee has an incentive not to appeal but it appears to be a correct statement of the law. However, it is a relatively rare exception which reflects the fact that procedural breaches of trust and confidence are minor. There will also be cases where, if the problems with the process are severe, and are tainted by discrimination for example, they will be impossible to repair. The Employment Appeal Tribunal in this case was wrong to conclude it could decide the matter for itself without remitting it to a tribunal of fact.

Furthermore, a grievance does not work in the same way. Consider a case of sexual harassment where it is clear that a grievance finding that the acts took place, or even the dismissal of the offender, would not be sufficient to restore trust. If it were, it would have deleterious effect on our discrimination law. Now it might be said that, in Buckland, the breach was less serious than this but, if so, it is much more likely that there was no breach at all than that it was cured, and any challenge to the findings of the tribunal ought to have been mounted on that basis, applying Fairbrother if necessary (and if possible). The question of whether or not there is a breach of the implied term is a matter of fact and so, if the Fairbrother challenge fails, there is absolutely no reason to interfere with the findings of the tribunal.

In performing the analysis, unfair dismissal law is undoubtedly helpful, and even Judge Peter Clark is willing to rely upon Roberts v West Coast Trains, in which a dismissal disappeared when an appeal was upheld, as a useful analogy. However, more pertinent is the case of Taylor v OCS Group which warns against legalism and states that the overall effect of a procedure should be considered. Rather than asking whether there is a breach and then asking whether it has been fixed, the question is whether the process is adequate when considered as a whole. This is essentially the approach taken in Fairbrother. It is important to remember that, in several cases, it will be impossible for trust to be restored, at least not until years later. The alarming statement of the Employment Appeal Tribunal that the breach must have been fixed because there is nothing else that the employer could have done must be wrong.

It is now time to talk about the range of reasonable responses, a frequently misunderstood concept. As the Court of Appeal made extremely clear in HSBC v Madden, ”there will be cases where there is room for reasonable disagreement among reasonable employers as to whether dismissal for the particular misconduct is a reasonable or an unreasonable response.” To put it another way, the word ’reasonable’ means the same as within the range of reasonable responses, which is not a gloss on the literal reading of the statute. It is simply a reflection of the reality that there is frequently more than one reasonable solution. It would be a gloss on the statute to say that there is always only one solution in every case.

It might be objected that the word ‘reasonable’ appears elsewhere in employment legislation, such as in discrimination law, where reasonable adjustments must be made for disabled people and, previously, justification for indirect discrimination was required to be reasonable. There is no reasonable range in these cases but this is because an employer is expected to keep disadvantage to a minimum. Because there is just one factor to weigh in the balance, it is feasible to expect an employer to adopt the best solution. In an unfair dismissal situation, there are many considerations and it is less clear which rights of the employee are to be given the most weight. As a result, there will be multiple reasonable options.

I now want to return to Sharp. Having suggested in an earlier post that the second part of the test does not apply in the same way when the implied term is engaged, I nevertheless think that it is helpful to examine what it says about reasonableness. It states that whether there is a constructive dismissal depends upon whether there has been a fundamental breach of contract, not whether an employer has behaved unreasonably. In the case of an express breach, it follows that there can be a constructive dismissal even where an employer is found to have acted reasonably (Tapere is an example of this).

This is all very well but Sharp prefers the contract test because, otherwise, it suggests, constructive dismissal can be found on whimsical grounds. Therefore, in most cases, the test is higher than that of a reasonableness test. I would suggest that this will always be so for a breach of the implied term, not properly considered in Sharp. As ‘reasonable’ means within the range of reasonable responses and the action of an employer must be worse than unreasonable to make out a breach of trust and confidence, it is correct that a finding of such a breach arising from an action in the range of reasonable responses would necessarily be perverse. This is important because it is difficult to overturn findings on perversity grounds but it is necessary to establish a basis for challenging them to ensure consistency in the law.

The decision in Parkwood Leisure v Alemo-Herron is authority for the proposition that, following a TUPE transfer, an employee is not entitled to benefit from any changes to a collective agreement that are negotiated with the transferor after the transfer. The most interesting aspect of the case is its treatment of European law. The English authorities had developed in line with a more generous interpretation of TUPE but the European Court of Justice had taken a narrower view. The Employment Appeal Tribunal held that the English cases remained good law even though they were no longer necessary to comply with the Directive. The Court of Appeal disagreed, saying that TUPE had been incorrectly interpreted.