A settled communicated intention to pay half instead of full pay was a fundamental breach of contract.
The Claimant teacher brought a claim for unfair constructive dismissal and unpaid wages against the Respondent school.
Facts:
The Claimant had been signed off work with stress due to allegations he faced at work. After a few months, his sick pay was reduced from 100% to 50%. The Respondent had misinterpreted the collective agreement regarding sick pay incorporated into the Claimant's contract, constuing it to mean that 100% pay would only be paid for physical injuries. By letter of 29 March 2010, the Claimant was notified that his pay was to be reduced to 50% as of 28 May 2010. On 26 May 2010, the Claimant handed in his resignation.
Unpaid wages:
At a previous tribunal, Employment Judge Tickle held that the provisions regarding 100% pau applied equally to both physical and psychiatric injury. The Claimant was thus awarded the difference in pay for the material period. The Judge made no findings as to the Respondent's belief that it only had to pay half pay.
Constructive Dismissal:
The Employment Tribunal:
A second tribunal deciding the issue of constructive dismissal held that, although the reduction in pay was a breach of the contractual term regarding sick pay, it was not a fundamental breach upon which to found a constructive dismissal claim. The Respondent had honestly (although mistakenly) believed that the Claimant was receiving the correct level of pay and thus was not in breach of the contractual term: the Respondent had shown an intention not to be bound by that term. The Claimant's claim for constructive dismissal was therefore rejected. In reaching this decision, the tribunal relied upon the judgment of Employment Judge Tickle.
The Claimant appealed.
The Employment Appeal Tribunal:
The EAT, hearing the case on 19 June 2012, held that the Employment Tribunal had erroneously relied upon Employment Judge Tickle's decision on pay; he had made no finding regarding the Respondent's belief, honest or otherwise. The Tribunal made a finding of fact that the Respondent deliberately intended to pay the Claimant at a rate of 50%; the EAT held that this could only be interpreted as a fundamental anticipatory breach of the Claimant's contract.
The appeal was upheld and the question of constructive dismissal was remitted back to another ET on the basis that the breach was fundamental, going to the root of the contract.
The full judgment can be found at http://www.bailii.org/uk/cases/UKEAT/2012/0070_12_1906.html
Naomi Owen
Constructive Dismissal:
The Employment Tribunal:
A second tribunal deciding the issue of constructive dismissal held that, although the reduction in pay was a breach of the contractual term regarding sick pay, it was not a fundamental breach upon which to found a constructive dismissal claim. The Respondent had honestly (although mistakenly) believed that the Claimant was receiving the correct level of pay and thus was not in breach of the contractual term: the Respondent had shown an intention not to be bound by that term. The Claimant's claim for constructive dismissal was therefore rejected. In reaching this decision, the tribunal relied upon the judgment of Employment Judge Tickle.
The Claimant appealed.
The Employment Appeal Tribunal:
The EAT, hearing the case on 19 June 2012, held that the Employment Tribunal had erroneously relied upon Employment Judge Tickle's decision on pay; he had made no finding regarding the Respondent's belief, honest or otherwise. The Tribunal made a finding of fact that the Respondent deliberately intended to pay the Claimant at a rate of 50%; the EAT held that this could only be interpreted as a fundamental anticipatory breach of the Claimant's contract.
The appeal was upheld and the question of constructive dismissal was remitted back to another ET on the basis that the breach was fundamental, going to the root of the contract.
The full judgment can be found at http://www.bailii.org/uk/cases/UKEAT/2012/0070_12_1906.html
Naomi Owen