Why is it important to handle grievances properly?
What might happen if grievances are not handled properly? The recent Employment Appeal Tribunal case of Nelson v Renfrewshire Council relates to a complaint of constructive unfair dismissal under section 95(1) of the Employment Rights Act 1996 following a two-stage grievance process carried out by the respondent. Constructive dismissal is a complex area of law. Although the employee has resigned, for employment law purposes they have been “dismissed”. However, the employee’s resignation must be in response to a sufficiently serious and fundamental breach of contract by the employer.
Background
The claimant was employed as a teacher from 2012 until 2022 and the Employment Tribunal claim arose out of events between 7 October 2021 and the claimant’s resignation on 7 November 2022. The initiating incident occurred during a work-related discussion between the claimant and head teacher during which the claimant felt that the head teacher had behaved in an aggressive and intimidating way towards her.
The head teacher’s voice was described by witnesses as raised and having an “angry” tone when speaking to the claimant in her office. The claimant was seen leaving the office visibly upset and was followed by the head teacher who pointed at her and said words to the effect of “If you’ve got something to say, say it to my face” and “what we were discussing is confidential”.
The claimant subsequently lodged a grievance which alleged the head teacher had treated her in a way that was “threatening, insensitive and aggressive”, contrary to the respondent’s “Respect at Work” policy. An investigation was carried out and a stage-one hearing was convened. Despite two witness statements supporting the claimant’s grievance, the investigator found no evidence that the head teacher had treated the claimant in the manner that she had alleged. This finding was based on the grounds that the head teacher and another witness had denied the claims. No statements had been taken or provided by the respondent.
The claimant appealed the outcome to a stage-two hearing. The conclusion was that the claimant experienced the incident to be “threatening, insensitive and aggressive” but it was again found that the head teacher had not behaved in that way.
The claimant did not appeal to the stage-three hearing as she had lost faith in the system and resigned with immediate effect. The respondent’s grievance procedure expressly stated that employees were normally expected to exhaust these grievance procedures if they wished to take their grievance to an Employment Tribunal.
Employment Tribunal (ET)
The claimant made a claim for constructive unfair dismissal arising from the alleged mistreatment by the head teacher and the way her grievance was handled, which constituted a breach of the implied term of trust and confidence.
The ET held that the head teacher had pointed at the claimant, that her words were aggressive and that it was “not professional behaviour”. The essential allegation was therefore proved, and the head teacher’s conduct was found to be “threatening, insensitive and aggressive”.
The ET found that this incident was likely to, and did, undermine trust and confidence without reasonable and proper cause. However, on its own, it would not come close to a breach of the implied term because it did not reach the level of destruction of, or causing serious damage to, the relationship of trust and confidence. It was regrettable and inappropriate behaviour but it was a one-off incident of relatively brief duration. Although the incident caused “some damage to the relationship of trust and confidence, that relationship was certainly not seriously damaged or destroyed.”
The stage-one hearing and the approach to the investigation was found to be unsatisfactory for several reasons. There was no proper attempt to gather evidence from the head teacher, no statement was obtained and she did not attend any minuted hearing or face questions. Her evidence appeared to have been gathered in an informal discussion which was inadequate for a fair and thorough investigation. This also meant there was a different process and level of scrutiny to the claimant’s evidence and the head teacher’s evidence.
The ET also found that the stage-one investigator showed bias and took into account her own prior knowledge and assessment of the head teacher, giving more weight to the evidence of the head teacher and another witness because of their rank within the school. The ET held this undermined trust and confidence without reasonable and proper cause.
The ET also found that the approach to evidence at the stage-two hearing was problematic and was not a re-hearing in any meaningful sense. The decision maker received significant evidence from the stage-one investigator rather than from primary sources and received no direct evidence or statement from the head teacher. The head teacher did not attend the hearing and the outcome letter failed to deal with the central conflict of evidence and was inadequate to detect and correct the earlier bias. There were significant failings throughout the respondent’s process and the claimant was entitled to be distressed about those. Objectively, the relationship of trust and confidence had been damaged.
However, the ET found that a stage-three hearing was an entirely viable option with a realistic chance of righting the wrongs of the previous stages. The ET therefore found that there was no breach of the implied term of trust and confidence because although the relationship had been damaged, the situation had not reached the level of serious damage to, or destruction of, the relationship of trust and confidence.
This meant the claimant’s resignation was not in response to a fundamental breach of contract and her claim was dismissed.
Employment Appeal Tribunal (EAT)
The claimant appealed on three grounds:
- if in light of the findings of fact made by the ET, whether its decision to dismiss the claim was perverse;
- whether in any event the ET failed properly to apply established legal principles to the facts; and
- that the decision was not Meek compliant, in that the reasoning in key aspects was inadequate.
The threshold for perversity is a high one, and an appeal on this ground will only succeed where an “overwhelming” case is made that the ET reached a decision which no reasonable ET, on a proper appreciation of the evidence and the law would have reached.
The EAT found that within the ET judgment there was an explicit link between the claimant’s failure to exhaust the grievance process and a conclusion that the relationship had not been damaged to the extent necessary to find a claim for constructive dismissal. The EAT held that the claimant’s failure to engage with the third-stage of the grievance process was irrelevant and accordingly the appeal in this aspect was allowed. Only the employer’s conduct is relevant when considering constructive dismissal claims.
The claimant identified six instances where the ET made findings as to whether the relationship of trust and confidence had actually been damaged as opposed to whether, looked at objectively, the conduct would be likely to seriously damage or destroy the relationship of trust and confidence. The EAT concluded that the language used by the ET indicated that its approach amounted to an error or law. The appeal was upheld on this basis.
The EAT also held that there was an error of law in the ET’s failure to address whether or not the conduct in question, looked at cumulatively, amounted in and of itself to a breach of the implied term.
The appeal in regards of Meek compliance was dismissed. There was not a lack of adequate reasoning by the ET, rather a misapplication of the law from the facts established.
The EAT remitted the matter back to the ET to consider whether, in light of its findings in fact, and without regard to the claimant’s failure to exhaust the grievance process, the respondent’s conduct amounted individually or cumulatively, to a repudiatory breach of the implied term of trust and confidence.
Comment
The judgment in this case serves as a reminder to employers of the importance of carrying out a fair and thorough grievance procedure. Any investigator appointed should proceed without bias to enable an independent, thorough and transparent investigation process, leading to a clear and well-reasoned outcome letter. This is important throughout all stages of the grievance procedure. A second-stage hearing, where there is one, should never be predetermined by the result of the first-stage, even unconsciously. Employers should ensure that they follow their own grievance procedures and comply with any time limits referred to and of course, be mindful of the Acas Code of Practice on Disciplinary and Grievance procedures.
For a different aspect of constructive dismissal see our recent article about affirmation of the contract.
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