Why You Should (Almost) Never Resign-Make Them Fire You

fair dismissal

Make them fire you.

Don’t make it easy for them.

Let me explain.

If an employer dismisses you it must be a fair dismissal.

And if you bring a case for unfair dismissal the employer will have to prove the dismissal was fair and justified.

The burden of proof is on the employer.

And it can be difficult to justify a dismissal because many employers get the procedure wrong.

In fact, 80% of unfair dismissal cases are lost because of the absence of fair procedures in carrying out the dismissal.

On the other hand, if you quit because of what you claim is the intolerable conduct of the employer you must prove you had no option but to resign.

In other words, the burden of proof shifts from the employer to the employee.

And the standard of proof is pretty high too.

It is not enough to show that (s)he was unpleasant, or rude, or had rough and ready management skills.

No, you must prove you had no option but to quit.

However there are exceptions to every rule and there are two circumstances where you may well be justified in quitting:

  1. Where to continue on in the employment may be injurious to your health and well being or
  2. Where you can negotiate an exit settlement which is satisfactory to you and avoids the inevitable dismissal/termination.

Many employees come to me with serious problems that they are suffering at work.

And many of them are worn out with the anxiety and the hassle that they face on a daily basis at work.

So many of them quit and just move on. Regrettably they have just made things a lot easier for the employer.

It’s not impossible to win a constructive dismissal case. But it’s much harder than to win an unfair dismissal.

So if you are an employee and you are in a difficult situation in work, think long and hard before quitting.

In the short run it can be tough to hang in there.

But in the long run it may be your best option because it allows you to negotiate an exit or bring a successful case for unfair dismissal.

You can learn more about unfair dismissal and constructive dismissal here.

When You Should Resign

You should resign if you are happy to do so, and if you are resigning on terms which are satisfactory to you. This would be when there is a negotiated settlement agreement.

Learn more about negotiated settlements here.

What do you think? Are the issues above familiar to you? Let me hear your comments below.

The 2 Tests for Constructive Dismissal (And Some Advice for Employers)

Constructive-Dismissal-Solicitors

There are 2 important tests which need to be reviewed in all claims of constructive dismissal. These tests emanate from the Employment Appeal Tribunal.

We now have the WRC adjudicating on these claims, but the same principles apply, and they emanate from a seminal decision from the Supreme Court in 2009, Berber (respondent) v Dunnes Stores Limited (appellant), [2009] 20 E.L.R. 61.

Constructive dismissal is where the employee quits and leaves the employment.

Constructive dismissal, as defined by the Unfair Dismissals Act 1977 is

“dismissal in relation to an employee means the termination by the employee of his contract of employment with his employer whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer the employee was or would have been entitled or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employee”.

The Employment Appeals Tribunal has held that an employee is only entitled to succeed in a constructive dismissal claim where

“An employee is entitled to terminate the contract only when the employer is guilty of conduct which amounts to a significant breach going to the root of the contract or shows that the employer no longer intends to be bound by one or more of the essential terms of the contract.”

The relationship of trust and confidence between employer and employee is a 2 way one.  The Tribunal has held that

“….. an employer is entitled to expect his employee to behave in a manner which will preserve his employer’s reasonable trust and confidence in him so also must the employer behave”.

So the Tribunal has to decide in any constructive dismissal case whether

“the employer’s conduct amounted to undermining the relation of trust and confidence between the parties in such a way as to go to the root of the contract. “

The Contract Test

This “contract test” was summarised in the English case “Western Excavating Ltd. V Sharpe (1978)”:

” If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract then the employee is entitled to treat himself as discharged from any further performance”.

The Reasonableness Test

The reasonableness test asks whether an employer conducts himself or his affairs so unreasonably that the employee cannot fairly be expected to tolerate it any longer and justifies the employee leaving.

In Berber v Dunnes Stores  the Supreme Court held, in allowing the Dunnes Stores’ appeal and setting aside the judgment of the High Court:

In determining whether there has been a breach of the implied term of mutual trust and confidence in employment contracts:

  1. The test is objective.

  2. The test requires that the conduct of both the employer and the employee be considered

  3. The conduct of the parties as a whole and the cumulative effect must be looked at.

  4. The conduct of the employer complained of must be unreasonable and without proper cause and its effect on the employee must be judged objectively, reasonably and sensibly in order to determine if it is such that the employee cannot be expected to put up with it.

Breach of Contract-Implied Term of Trust and Confidence

The Supreme Court, in Berber v Dunnes Stores, held:

There is implied in a contract of employment a mutual obligation that the employer and the employee will not without reasonable and proper cause conduct themselves in a manner likely to destroy or seriously damage the relationship of confidence and trust between them. The term is implied by law and is incident to all contracts of employment unless expressly excluded.

The term imposes reciprocal duties on the employer and the employee. In assessing whether there has been a breach by the employer what is significant is the impact of the employer’s behaviour on the employee rather than what the employer intended. Having regard to the mutuality of the obligation the impact of an employee’s behaviour is also relevant.

The test is an objective one: if conduct objectively considered is likely to cause serious damage to the relationship between employer and employee a breach of the implied obligation may arise (Malik v Bank of Credit and Commerce International S.A. [1997] I.C.R.606).

In Lewis v Motorworld Garages Limited [1986] I.C.R. 157 Glidewell J. summarised the law as follows:

  1. In order to prove that he has suffered constructive dismissal an employee who leaves his employment must prove that he did so as a result of a breach of contract by his employer, which shows that the employer no longer intends to be bound by an essential term of the contract: see Western Excavating (E.C.C.) Limited v Sharp [1978] I.C.R. 221.
  1. However, there are normally implied in a contract of employment mutual rights and obligations of trust and confidence. A breach of this implied term may justify the employee in leaving and claiming that he has been constructively dismissed: see Post Office v Roberts [1980] I.R.L.R. 347 and Woods v W.M. Car Services (Peterborough) Limited [1981] I.C.R. 666 at 670, per Browne-Wilkinson J.
  1. The breach of this implied obligation of trust and confidence may consist of a series of actions on the part of the employer which cumulatively amount to a breach of the term, though each individual incident may not do so. In particular in such a case the last action of the employer which leads to the employee leaving need not itself be a breach of contract; the question is, does the cumulative series of acts taken together amount to a breach of the implied term. See Woods v W.M. Car Services (Peterborough) Limited [1981] I.C.R. 666. This is the ‘last straw’ situation.”

As to the “last straw” it was held in Omilaju v Waltham Forest London Borough Council [2005] I.C.R. 481 that the quality that a “last straw” had to possess was that it was an act in a series whose cumulative effect amounted to a breach of the implied term. The essential quality of that act was that, when taken in conjunction with the earlier acts on which an employee relied, it amounted to a breach of the implied term of trust and confidence.

As to whether conduct amounts to a repudiation of the contract the ordinary law of contract applies: the cumulative effect of the acts complained of must be such as to indicate that a party, in this case the employer, had repudiated its contract (Brown v Merchant Ferries Limited [1998] I.R.L.R. 682).

Circumstances which render it reasonable for an employee to terminate the contract of employment may constitute ‘constructive dismissal’ and may also justify resignation.

“Entitlement to terminate a contract by reason of the conduct of the employer is a perfectly familiar concept of the law of contract. Like much else it is easy to formulate but can be difficult to apply…The law of contract for this purpose is that where an employer so conducts himself as to show that he does not intend to be bound by the contract of employment the employee is entitled, at his option, either to treat the contract as at an end, and cease performing his part…The question of what is reasonable in the circumstances having regard to equity which has to be considered in cases of unfair dismissal, applies equally to the facts…It is the conduct of the employer which you must look at…But it is not the epithets which his conduct attracts, but whether you are entitled to treat your contract as at an end, and whether if you exercise your option to do so you have been ‘constructively dismissed.” Wetherall (Bond St. W1) v Lynn (E.A.T.) 1

The Employment Appeals tribunal, in deciding any constructive dismissal claim, will apply the tests set out above-the “reasonableness” test and the “contract” test- and decide each case on its particular facts.

One thing that the employee should do in all but the most exceptional circumstances is to firstly exhaust all internal avenues for dealing with his/her grievances, even if he/she believes it will be a futile exercise.

Tips for Employers to Prevent Constructive Dismissal Losses

If the employer is unsure of the nature of complaints or grievances from the employee it is a good idea to seek the details. This shows a willingness on the part of the employer to address the employee’s issues.

It is also advisable for the employer to ask a senior member of management who has no prior involvement with the employee or her grievances to investigate. Again, this indicates a reasonableness on the part of the employer in dealing with the complaints.

The employer should also be agreeable to engage in mediation to resolve the differences.

These three steps will assist the employer as the ultimate decision maker-WRC or Labour Court- in relation to a constructive dismissal claim will have a significant amount of regard for the reasonableness of the conduct of the parties.

Update June 2018

A good summary of the law on constructive dismissal is contained in a June, 2018 decision of the WRC, ADJ 00003961 

Without Prejudice Negotiations Can Be High Risk for Employers if Not Handled Correctly

without-prejudice-negotiations

“Without prejudice” negotiations in an employment dispute can be an incredibly useful tool.

For many employers, they represent the best route to an acceptable outcome to an employment dispute.

Because, quite frankly, the employer often “hasn’t a leg to stand on”. You wouldn’t believe what some of them get up to!

However, if they are not handled correctly they can backfire badly on the employer.

Well Drafted Settlement Agreement

And without a well drafted agreement, the employer does run the risk of an employee collecting on foot of a settlement and bringing legal proceedings afterwards.

Without prejudice discussions or negotiations are generally, but not always, excluded from being introduced into evidence in subsequent legal proceedings.

The purpose of such discussions are to resolve the dispute to the satisfaction of both parties without the costs associated with going to Court or some other dispute resolution body.

“Without prejudice” negotiations should be carried on between lawyers for both sides, not the parties themselves. In the employment context it is a mistake for the employer to carry on “off the record” or “without prejudice” discussions with an employee.

The reason for this is simple: the employee may claim not to have fully understood the implications of such discussions.

And if this is the case the employee may well claim that even though she gave her consent for such discussions to be private, “off the record”, and “without prejudice” that her consent was not informed consent.

Independent Legal Advice

The employer should ensure that the employee has obtained independent legal advice and confirms this in writing.

Any decision maker, be it a Court or tribunal, is likely to find for the employee on this point given the perceived and/or real imbalance of power between employer and employee.

There is another reason why without prejudice negotiations or discussions can backfire on the employer.

For discussions to be truly without prejudice there must be a dispute between the parties; and the discussions must be an attempt to settle that dispute. Not a dispute in the normal sense of the word but a dispute in which legal proceedings have commenced or are being contemplated.

It’s not always certain whether a “dispute” would therefore exist to allow “without prejudice” discussions.

As state above “without prejudice” discussions can sometimes be admitted in evidence in subsequent legal proceedings. The High Court has held that without prejudice discussions can be admitted in evidence where the interests of justice require it.

For employers therefore it is prudent not to make a without prejudice offer directly to the employee to agree their exit from the employment.  Such an offer could be put forward by the employee in an unfair dismissal claim as evidence of dismissal.

The better course of action is for the employer to instruct a solicitor to negotiate with the employee’s solicitor.

It is better again if the employee or his/her solicitor initiates the discussions.

Negotiations between solicitors will be more structured and reduce the chance of the employee claiming that she did not know what without prejudice discussions meant. And the written settlement agreement should be water tight.

So if you are an employer and are thinking about getting rid of a troublesome employee, you should give some serious consideration to a “negotiated exit” through without prejudice negotiations.

It will probably be cheaper in the long run.

Constructive Dismissal-The Burden of Proof on the Employee is a Heavy One

Constructive-Dismissal-Solicitors

Can we be honest?

Constructive dismissal cases are difficult to win because the burden of proof is on the employee to prove that she had no other option but to resign due to the unreasonableness of the employer.

The January, 2013 decision of the Employment Appeals Tribunal in the case of Daniel O’Gorman v Glen Tyre Company Limited illustrates this.

In this case Mr. O’Gorman was a mechanic who had gone on sick leave in May, 2010 and did not return to work. He resigned from his position in September, 2010.

Mr. O’Gorman brought a case for constructive dismissal.

Decision of EAT

The Employment Appeals Tribunal in its decision referred to the burden of proof on the employee as being a ‘very high one’. It held that the employee must prove that his resignation was not voluntary.

The EAT must look at the contract and decide whether there has been a significant breach of the employment contract going to the root of the contract.

If there has not been a breach by the employer the EAT will then look at the conduct of the employer and employee and decide on the ‘reasonableness’ of the decision of the employee to resign.

The claim by the claimant for constructive dismissal fell under three headings:

  1. The excessive workload placed on him
  2. Exclusion in the workplace, for example at lunch breaks
  3. Being bullied and harassed in the workplace.

Mr. O’Gorman suffered from Asperger Syndrome.

Mr. O’Gorman left work in May, 2010 and did not return due to stress, according to his parents and GP who stated it was work related. However, the employer stated that he did not know this until he received the 2nd medical certificate.

The EAT held that it is crucial in a constructive dismissal case that the employee fully informs the employer of the complaints being made against him and gives the employer the opportunity to resolve the problems.

Interestingly, the EAT in this held that the parents of the claimant had a duty to let the employer know of the issues.

The EAT found no significant breach of contract going to the root of the contract which would have prevented the employee from carrying out his duties as per the contract.

The EAT then examined the conduct of both parties and found that the decision of the employee to resign was not a reasonable one.

The claimant’s claim failed.

Read the full decision here.

You may also want to read about the 2 tests used in constructive dismissal cases and  about unfair dismissal and constructive dismissal in Ireland.

Unfair Dismissal During the Probationary Period-the Options Open to the Employee

probation-employment-contract

Many employers believe, wrongly, that they can easily dismiss an employee once they are still within the probationary period.

This is mistaken.

Even employees on probation are entitled to natural justice and fundamentally fair procedures.

While the employee may not have the necessary service (12 months) to avail of the protection of the Unfair Dismissals Acts 1977-2007, a claim can be made under the Industrial Relations Act, 1969 (as amended) for unfair dismissal.

There is no service requirement under this act.

Industrial Relations Act, 1969

You can refer a complaint to the Workplace Relations Service under section 13 of the Industrial Relations Act, 1969. However, if one party to the dispute objects in writing to the investigation the adjudicator cannot investigate:

if a party to the dispute notifies the commissioner in writing that he objects to the dispute being investigated by a rights commissioner.(Section 13 Industrial Relations Act, 1969)

Also, you can refer a dispute to the Labour Court under section 20(1) or 20(2) of the Industrial Relations Act, 1969. However, the Labour Court’s recommendation is not legally enforceable unless both parties have agreed prior to the hearing to be bound by the outcome. Then either party could sue the other party on foot of the undertaking for breach of contract.

Section 13(9) of the Industrial Relations Act, 1969 allows for an appeal from a decision of the Rights Commissioner where a party has referred a dispute under section 13. This occurred in the case below:

In IRISH POSTMASTERS UNION- AND -A WORKER the Labour Court awarded the appellant €30,000 and overturned the decision of the Rights Commissioner’s decision that the employer was not in breach of contract when terminating employment while the probationary period was still in place.

The finding of the Labour Court in this case is instructive and the principal finding was that the employer’s decision not to

adhere to either its own disciplinary procedures or be bound by the provisions of the Code of Practice on Grievance and Disciplinary Procedures S.I. No 146 0f 2000 because he was on probation, was misconceived.

Here is the full decision of the Labour Court:

DECISION :

The matter before the Court concerns an appeal of a Rights Commissioner’s Recommendation, which found against the Worker’s claim that his Employer unfairly dismissed him.

The Appellant submitted that the dismissal which occurred during his probationary period was unfair and was conducted without due regard for fair procedures. He held that he was not given a right to reply, he was denied the right to be represented and he was not afforded the opportunity of an appeal against the termination decision.

In its defence the Employer submitted that the Appellant was treated in accordance with his contract of employment, which provided for an ongoing review of his performance and included a clause, which stated, “Either party may terminate employment during the probation or at the end of the probation period.”

The Employer submitted that while there were no disciplinary issues with the Appellant, concerns did emerge about his overall suitability for the position and it was decided to extend his probation. When he objected to such an extension, it was decided to terminate his employment, and pay him three months salary in lieu of notice, as per his contract of employment.

The Court has carefully considered the written and oral submissions of both parties. It is clear to the Court that the rationale behind the termination of employment was the Employer’s error in appointing the Appellant to the position in the first place and it consequently sought to extricate itself from that contract.

In all the circumstances of this case, the Court finds that the Employer’s decision not to adhere to either its own disciplinary procedures or be bound by the provisions of the Code of Practice on Grievance and Disciplinary Procedures S.I. No 146 0f 2000 because he was on probation, was misconceived.

Consequently, the Court finds that the dismissal of the Appellant was unfair. The Court finds in favour of the appeal and overturns the Rights Commissioner’s Recommendation.

The Court recommends that the Appellant should be compensated by the payment of €30,000 in full and final settlement of the claim before the Court. For the avoidance of any doubt this recommended payment is in addition to the three months pay in lieu of notice already paid.

The Court so decides.

Signed on behalf of the Labour Court

Caroline Jenkinson

27th January, 2011     ______________________

DN       Deputy Chairman

It is advisable therefore for the employer to adhere to its disciplinary policy or, if this does not apply during the probationary period, a probationary policy should be in place and which should broadly follow the principles of fair procedure set out in the Code of Practice on Grievance and Disciplinary Procedures and the rules of Natural Justice.

Furthermore, section 20(1) of the Industrial Relations Act, 1969 provides for investigation of the dispute at the request of the worker(s), provided he agrees to accept the recommendation:

20.(1) Where the workers concerned in a trade dispute or their trade union or trade unions request or requests the Court to investigate the dispute and undertake or undertakes before the investigation to accept the recommendation of the Court under section 68 of the Principal Act in relation thereto then, notwithstanding anything contained in the Principal Act or in this Act, the Court shall investigate the dispute and shall make a recommendation under the said section 68 in relation thereto.

Extending the Probationary Period and Termination of the Employment

To extend the probationary period of an employee there must first be provision for an extension, either in the contract of employment itself or in the staff handbook.

Probationary review meetings should be held during the probationary period with the employee being given feedback as to how they are performing and any areas requiring improvement.

At the end of the probationary period there should be a final probationary review which will assess the employee’s performance and suitability. The employee will then either be confirmed in the employment or dismissed or have the probationary period extended.

The outcome of this review should be communicated to the employee in writing and if the probation is to be extended the employer should make clear what improvements are necessary. The probation period should only be extended to allow the employee to improve in whatever areas he/she is deficient.

The employee should be advised in writing of the need to extend the probation period, the required improvement areas and the review dates to monitor performance.

If the employee is to be terminated he/she should be invited to a disciplinary hearing and given the opportunity to make representations on his/her behalf. The employer should not take a decision to terminate until he has considered these representations.

The decision to terminate and the reasons should be given to the employee in writing.

Dismissed During Probation?

So, if you are unfairly dismissed during your probation there are 4 options which may be open to you, depending on the circumstances:

  1. A claim for unfair dismissal under the Industrial Relations Act, 1969 (as amended)
  2. A civil Court action for breach of contract/wrongful dismissal
  3. A claim to the Equality Tribunal under the Employment Equality Acts 1998-2004
  4. a claim under the Protected Disclosures Act, 2014

Unlike with the Unfair Dismissals Acts, there is no service requirement for any of these 3 options.

For this reason, the probationary clause in the employment contract needs to be properly drafted to provide for a shorter period of notice for termination during probation and the use of a probationary policy if the full disciplinary policy is not to be employed during probation.

Regardless of how it is drafted, natural justice and fair procedures must be afforded to the employee in extending the probationary period or terminating at the end of it.

Word of warning for employees

A decision in your favour from the Labour Court has moral authority, but is unenforceable if the employer simply chooses to ignore it. In the case above involving a trade union, it would have been very difficult for the union to ignore a recommendation from the Labour Court.

And if you refer a dispute under section 13 to the Workplace Relations Commission the adjudicator cannot investigate if the employer objects in writing.

That’s not the case with smaller employers, or employers who simply don’t care about adverse publicity, or any other actions you might take to have your decision recognised and enforced.

From an employee’s perspective, and with a view to future employment, it may well be worthwhile to have official recognition that he was unfairly dismissed-even if he was never to obtain a cent in compensation.

This will depend on the circumstances of each case, and a decision for the employee to think carefully about.

You may also be interested in reading advice for employees on probation.