The 2010 Apprentice winner, Stella English, has lost her claim for constructive dismissal against Lord Sugar’s company, Amshold Group Limited. The Employment Tribunal’s decision can be read here: English v Amshold Group Ltd.
It was widely reported in the press that English described her £100,000 a year job as “a sham” and claimed she was treated like an “overpaid lackey”. She suggested she was forced to resign from the position when she was told her contract would not be renewed.
However, the Tribunal found unanimously for Amshold Group Limited, finding that there were no grounds for English’s complaint of unfair constructive dismissal and did not believe her evidence over that of her previous employer.
In a stern written judgment handed down on 10 April 2013, the Tribunal declared English’s claim as one “which should never have been brought”.
At paragraph 150 of its written judgment, the Tribunal states:
“In an unfair constructive dismissal case the burden lies with the claimant to establish conduct on the part of the employer that is so serious it destroys or seriously damages trust and confidence.”
This blog post looks more closely at the elements within this statement and Stella English’s case.
What is constructive dismissal?
Constructive dismissal occurs when an employee resigns in response to the employer’s conduct, which amounts to a fundamental or repudiatory breach of the employment contract. The statutory definition is found in section 95(1)(c) of the Employment Rights Act 1996.
The following elements are needed to establish constructive dismissal:
1. A repudiatory breach of an express or implied term of the employment contract by the employer. This must be sufficiently serious to justify the employee resigning.
2. The employee resigning in response to the employer’s breach of the employment contract. Essentially, the employee accepts the employer’s breach and treats the employment contract as being at an end. The resignation is treated as a dismissal.
3. The employee must not delay. If the employee treats the contract as continuing (i.e. does not resign soon after the employer’s breach of contract occurs) the breach may be waived.
It may not be just one incident that amounts to repudiatory breach of the employment contract; sometimes it is a series of incidents or pattern of behaviour which, taken as a whole, amounts to such conduct.
Implied term of trust and confidence
An employment contract consists of express terms agreed between the parties (such as wages, hours and place of work) and implied terms, which are deemed to be part of the contract by the court. One such implied term is that of trust and confidence.
The duty of trust and confidence is mutual, however, in the context of unfair constructive dismissal it is the conduct of the employer that comes under scrutiny. Examples of what may constitute an employer’s breach of the duty of trust and confidence include:
• Unjustified and/or continual criticism of the employee over a period of time or publically reprimanding the employee.
• Failure to investigate properly an employee’s grievance.
• Refusal to offer an employee a new contract or to offer an employee the same terms as offered to the rest of the workforce.
If an employer breaches the implied term of trust and confidence, this may constitute a fundamental breach of the employment contract that will entitle the employee to resign and treat themselves as having been constructively dismissed.
Stella English’s case against Amshold Group Limited
Stella English was employed by Viglen Limited, a company within Amshold Group Limited. She had worked for the company before her Apprentice win was aired.
Her employment with Viglen Limited commenced on 1 September 2010 at a salary of £65,000 per year but that position came to an end on 14 December 2010. She was told of her Apprentice win on 16 December 2010 and her prize was a one year contract as Projects Manger with the company on a £100,000 salary commencing 1 January 2011.
She resigned from the position on 23 May 2011, following a meeting with Lord Sugar. She had apparently told Lord Sugar that the role was not challenging enough for her.
Because of concerns that her early resignation might impact on the credibility of the Apprentice, she was encouraged to sign a new employment contract to commence on 1 June 2011 with an associated employer, YouView.
Amshold Group Limited remained her employer, however, by virtue of section 231 of the Employment Rights Act 1996. She therefore had the requisite continuity of employment to bring an unfair dismissal claim.
YouView was unable to keep Stella English on beyond her sixth month secondment and, in a meeting on 28 September 2011, Lord Sugar also told her that her one year contract would not be renewed at the end of December 2011. Stella English then submitted her resignation, with immediate effect, on 6 October 2011 and went on to claim constructive dismissal.
Stella English submitted to the Tribunal that Amshold Group Limited breached the implied term of trust and confidence by failing to provide her with meaningful work. She also alleged that Lord Sugar told her at a meeting on 28 September 2011 that her contract would not be renewed at the end of December 2011 and had said: “I don’t give a shit… now we are done.” She further argued that Lord Sugar’s conduct at the meeting was the last straw in a culmination of events and statements made by senior management that had seriously damaged the relationship of trust and confidence.
Naturally, as the majority of her allegations were based on oral statements, the Tribunal was faced conflicting evidence about what was said and by whom. Overall, the Tribunal believed the evidence presented on behalf of the employer and, consequently, it found that Stella English had failed to show any conduct amounting to a fundamental breach of contract.
Of note was the Tribunal’s finding that she was given “a real job” that was specifically selected for her and provided the opportunity for her “to expand and build on her already acknowledged experience and ability”. Further, that the conduct of which she complained “could not objectively be considered to destroy or seriously damage trust and confidence in the employment relationship.”
Ultimately, the Tribunal labelled it as “a claim which should never have been brought”.
Food for thought
An interesting question, which the Tribunal did not answer as it either found that the conduct complained of either did not occur or was waived by Stella English, is whether or not the alleged conduct of an associated employer can be taken into account in an unfair dismissal claim against the new associated employer.
Although it will depend on the circumstances of the case, it is my view that as a general principle it should not be possible to rely on such conduct to establish a fundamental breach of a fresh contract of employment.
I would be interested to hear your views on this.