Bridge HR articles

Sometimes little phrases can have big effects. 

Background

1. Mrs Karen Edwins began working for Artem Ltd on the 1 January 1996 and worked her way to the position of Finance Director and was appointed to the Board.
2. During an unscheduled meeting, Mr Michael Kelt, the Co-founder, CEO and owner of 50% of the shares informed the claimant that “he had a lack of confidence in her due to a “few things [going] dramatically wrong””.
3. Mrs Edwins resigned and raised a grievance.
4. The grievance was rejected, 36 days after the grievance hearing.
5. Mrs Edwins alleged that she had suffered discrimination and harassment based on her sex, race and age.
6. During the hearing, there were a number of assertions, from various individuals, that Mr Kelt had said that:

1. another individual had got her “knickers in a twist”, which she had found offensive;
2. he had wanted a “pretty young lady” on reception; and
3. he had called a female manager an “old nag”.

Outcome

Mrs Edwins was successful for her claims of:

• unfair dismissal (the Tribunal finding that the comments made in the unscheduled meeting being a repudiatory breach of contract);
• breach of contract (lack of notice); and
• the dismissal being an act of sex and race discrimination.

As such, the matter has been referred to a remedy hearing to determine the compensation.

Takeaways for HR

The case demonstrates the risks of claims for discrimination and harassment, based on some ‘common’ phrases that we might hear in our day-to-day lives.

The more important aspect of this case, however, is the reminder of the implied term of mutual trust and confidence, which is found in every contract of employment.

In a nutshell, this requires you, as the employer to act in a way that preserves that mutual trust and confidence, or in the words of Lord Steyn:

“The employer must not, without reasonable and proper cause, conduct itself in a manner calculated and likely to destroy or seriously damage the relationship of trust and confidence between employer and employee”.

When we look at this, it is fairly easy to understand how the Tribunal found that the words used by Mr Kelt to an individual with circa 25 years’ tenure and a very senior position, would breach the implied term.

Depending on the circumstances, where there is a breach of the implied term, it could give rise to a claim for constructive unfair dismissal, as it did in this case, which can be costly and time-consuming to defend.

To try and minimise those risks, we recommend training to avoid such comments and a simple and easy-to-use policy to follow to handle such issues.

If you are interested in any of the information contained within this article, please do not hesitate to contact the Bridge Employment Law team on 01904 949008, or email us at enquires@bridgeehr.co.uk.