Grievous harm in the employment relationship – grievance procedures and constructive dismissal claim

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Posted in:HR and Employment|September 24, 2013 | Join the mailing list

In Blackburn v Aldi Stores Limited, the Employment Appeal Tribunal has held that an employer’s failure to follow a fair grievance procedure may be a breach of the implied term of trust and confidence.  This term exists in every contract of
employment, even though it may not be expressly referred to in any written document.  It has developed from case law and means that an employer must not "…without reasonable and proper cause conduct itself in a manner calculated or likely to destroy or seriously
damage the relationship of trust and confidence between employer and employee."

The decision is important because a breach of the implied term of trust and confidence can form the basis of a constructive dismissal claim (where an employee resigns in response to a fundamental breach of the employment contract, and claims
that this constituted an unfair dismissal). 

The decision in Blackburn means that employers will need to be even more careful when considering grievances.  The facts of the case were that the manager who heard the claimant’s grievance also considered the claimant’s appeal.  In doing
so, Aldi did not adhere to its own grievance policy or the ACAS Code of Practice.  These both provide for an impartial grievance appeal process in which (other than in exceptional circumstances) a different manager, who has not previously been involved, should
hear an appeal.

The Employment Appeal Tribunal did not make a finding about whether Aldi’s failure to follow the procedure actually amounted to a breach of the implied term of trust and confidence. That question has been referred back to the Employment Tribunal
to decide on the facts, and it could have an important effect on constructive dismissal claims. 

The EAT’s view on the importance of the right to a fair appeal in respect of a grievance was clear.  It said in its judgment that this "is important both as a feature of the Respondent’s own grievance procedure and of the ACAS Code of Practice". 
It went on to say that it "is a significant right in the employment context".  

Nigel Crebbin, Employment Partner at Berg, commented that: "Not all breaches of a grievance procedure will be so serious that they amount to, or contribute to, a breach of the term of trust and confidence.  However, this is a new development,
and  we will only find out through Employment Tribunal decisions what types of procedural failures will amount to such a breach.  The key for employers is to follow the ACAS Code of Practice when dealing with grievance procedures and appeals."

For more information about any of the above or for practical commercial advice on this or any other aspect of employment law, please contact
Nigel Crebbin of the Berg Employment Team on 0161 833 9211 or email him at
nigelc@berg.co.uk.

Follow us on Twitter: @Berg_HR

The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or any of its partners or employees. Professional
legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.

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