I have had some more thoughts about why a breach of the impied term of trust and confidence can never result in a fair dismissal. My previous post notes that a breach of the implied term is defined as conduct which is likely to destroy or seriously undermine trust but there is a further part to the test, taken from Malik v BCCI, that there must not be reasonable or proper cause for that conduct. Conversely, according to Berriman v Delabole Slate, for a constructive dismissal to be fair, it is necessary that the employer show “the reasons for their conduct which entitled to employee to terminate the contract.” When the constructive dismissal is due to a breach of the implied term, the employer must both have no reasonable or proper cause for their conduct while, at the same time, that conduct must be for a potentially fair reason as well as fair in all the circumstances. This is difficult to imagine.

What is unusual about the implied term is that the reason for the conduct matters. If a person’s pay is reduced or his place of work is moved, whether there is a fundamental breach does not depend on why the changes were made. For the implied term of trust and confidence, this is very important so it must be distinguished accordingly.