UK: Human Capital (Employment): In Sickness And In Wealth?

Last Updated: 3 September 2007
Article by Mark Shrives, David Beswick, Nick Jones and David Whincup

An employee may be entitled to damages for future loss of earnings following her constructive dismissal even though she was off work on extended sick leave (and not being paid) prior to resigning. This was the finding in the recent Employment Appeal Tribunal case of GAB Robins (UK) Limited v Triggs.

Mrs Triggs began working for GAB Robins as a secretary/ PA in September 1999. Prior to her leaving in March 2005 she worked for two investigators, Messrs Carter and Woffinden.

From about April 2001 Carter raised concerns with his manager, Mr Baldock, about what he saw as Mrs Triggs’ excessive workload. In August 2003, Mrs Triggs collapsed at home and was signed off work for one week with stress. Both Carter and Woffinden continued to raise the matter of her workload with Mr Baldock. Furthermore, in February 2004 an audit report identified a need for Mrs Triggs to receive assistance with her workload but still none was provided. In addition to the problem of overwork, Mrs Triggs also felt that she was being bullied by Mr Baldock. By 30 September 2004 she had had enough. She had just returned from two days sick leave only to receive a telephone call from Mr Baldock when he shouted down the telephone at her. Mrs Triggs left the office and did not return.

Mrs Triggs’ doctor signed her off sick with stress and depression (later diagnosed as anxiety and depression). No-one from senior management contacted her, the only significant contact being by GAB Robins’ HR Manager to discuss Mrs Triggs’ sick pay.

On 15 February 2005 Mrs Triggs resigned and she subsequently brought a claim of unfair constructive dismissal.

The Employment Tribunal found that Mrs Triggs resigned in response to GAB Robins’ conduct which had had a cumulative effect on her and that as no fair reason had been advanced for her dismissal, her dismissal was unfair. The Employment Tribunal also rejected GAB Robins’ argument that because her sick pay entitlement had expired (and so she would not have been paid if her employment had continued) Mrs Triggs should not be entitled to recover any loss of earnings following her constructive dismissal. It awarded her a sum in respect of future loss of earnings even though, had she not left, she would not have been earning anything anyway.

GAB Robins appealed. The EAT was asked to decide (among other questions) whether in these circumstances Mrs Triggs was entitled to recover loss of earnings as a result of her dismissal, the first time that this issue has been raised on appeal.

Section 123(1) of the Employment Rights Act 1996 provides that "the amount of the compensatory award [for unfair dismissal] shall be such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the complainant in consequence of the dismissal insofar as that loss is attributable to action taken by the employer" (our emphasis). GAB Robins sought to argue that Mrs Triggs’ loss of earnings after the termination date flowed not from her constructive dismissal in March 2005 but from her incapacity to work from the previous September. Counsel for Mrs Triggs, however, sought to argue that it was GAB Robins’ repudiatory conduct which led to Mrs Triggs’ medical incapacity in the first place, starting in September 2004 and continuing after her termination the following March, so giving rise to a continuing loss of earnings thereafter.

The EAT held that GAB Robins’ conduct consisted of a breach of the implied term of trust and confidence through an accumulation of events dating back to 2001, that the breach caused Mrs Triggs’ illness in September 2004 and that she accepted the breach when she quit in February 2005. Rejecting GAB Robins’ argument that Mrs Triggs’ cause of action lay not in the Employment Tribunal but in action for damages for personal injury in the civil courts, the EAT confirmed the House of Lords’ opinion in Johnson v Unisys. This said that an employee faced with a repudiatory breach of contract by his or her employer who accepts the breach and leaves is limited to a claim of unfair dismissal and has no separate common law claim based on the breach. Mrs Triggs’ remedy for loss of earnings therefore fell within Section 123(1).

In what appears to be a classic judicial fudge, the EAT further held that the breach of the implied term formed part of the constructive dismissal and that Mrs Triggs’ ill health caused by that breach was therefore to be treated as a consequence of the dismissal. This led to her loss of the earnings which would otherwise have been received at the full rate from GAB Robins and such loss was therefore attributable to "action" taken by them.

This decision has a certain logic to it, but does it apply only where the sickness pre-dates the termination and is the fault of the employer? Take some other similar circumstances where illness impairs the employee’s reemployment prospects:

  • Where the employee was sick pre-dismissal other than through the employer’s default. The compensation would cover the balance of the employee’s company sick pay (if any) but not any longer period, since the loss beyond then would not be attributable to any action by the employer but to the continuing sickness.
  • Where the employee was dismissed for sickness in fact caused culpably by the employer. If the dismissal is unfair then the employee’s compensatory award should not be reduced, since his inability to mitigate his loss by reason of sickness is attributable to the actions of the employer. However, Frewin v Consignia in 2003 confirms that it is entirely possible for a sickness dismissal to be statutorily fair even where the employer caused the sickness in the first place.
  • Where the employee becomes sick (and so unable to mitigate) as a result of the dismissal, i.e. after it. So far as a causative link between the dismissal and the illness could be shown, then the resulting loss is clearly attributable to the actions of the employer and so the employee’s award should be unreduced. Note that this is the case whether or not it was foreseeable that injury would result from the dismissal – this is a statutory claim, not a personal injury claim based on normal negligence principles.
  • Remember also Section 88 ERA 1996. Even if by the time of the dismissal the employee’s sick pay had expired, he will still be entitled to full pay in lieu of the statutory minimum part of his notice if his contractual notice period is not more than one week more than his statutory minimum entitlement.

Working Time (Amendment)

Regulations Approved

Coming into force on 1 October 2007, the Regulations provide:

  • for an increase in the annual leave entitlement from 4 weeks to 5.6 weeks (28 days for a fulltimer)
  • that workers become eligible for the first additional 0.8 weeks from 1 October 2007; for the second 0.8 weeks from 1st April 2009.
  • that leave may not be replaced by a payment in lieu except where the employment is terminated or during an initial transitional phase to 1 April 2009
  • for the possibility of limited carry-over of the additional annual leave
  • that the additional annual leave shall not apply to a worker whose employer already provides each worker employed by him with an entitlement to additional annual leave of 1.6 weeks or 8 days (whichever is the lesser) as at 1 October 2007 by virtue of a relevant agreement that satisfies the conditions set out the amending Regulations (i.e. the additional leave cannot be paid in lieu (except on termination), can only be carried forward into the following leave year and is paid).
  • that partial days’ holiday in the first year of service will no longer have to be rounded up to the nearest full day.

The Regulations apply to Great Britain only and a separate Statutory Rule has been made in respect of Northern Ireland (also coming into effect on 1 October).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions