An Employment Tribunal has ruled that a recruitment company’s failure to provide an employee with reasonable remuneration amounted to unfair constructive dismissal.
The hearing in Liverpool heard how the employee, named as Mr C Decker, had worked for Extra Personnel Logistics since 2008 but been asked to agree to a reduction in working hours – from 32 to 16 hours per week – following the consultancy’s loss of two contracts.
Mr Decker advised his employer that he could not afford this reduction in salary and instead proposed a drop to 24 hours, providing his day rate could be increased from £102.97 to £110.00 – which amounted to an additional 88 pence per hour.
The Tribunal heard how in an exchange of emails the employer stated that he would have “this” sorted – which Mr Decker took to mean an acceptance of his proposal.
However, he was later told that the company was not in a position to offer a pay rise and instead was offered a new contract which he was told he needed to sign.
Mr Decker refused to sign the new contract and in the tribunal judgment it was noted that he “no longer felt valued as an employee” and that, in effect “he was being forced out…for asking for an additional £0.88 per hour”.
The panel ruled “that a reduction of this magnitude was a serious matter for [Mr Decker]” and that his employer “had fundamentally breached” his employment contract.
Mr Decker was awarded £16,852.12 for unfair constructive dismissal, including a basic award of £4,942.92 for his eight years of continuous employment and compensation of £11,882.20, which was increased by 10 per cent because the employer was in breach of the Acas code of practice.
The Acas breach was a result of the employer’s failure to adequately treat an email from Decker laying out the issues he had with the company’s actions, as a grievance.
Samantha Randall, a Solicitor with Palmers, who specialise in employment law, said: “This case highlights the fact that the re-negotiation of working hours and its net effect on an employee’s salary must be handled carefully. Any attempt to enforce a new contract, without taking on board the concerns of a worker, can be construed as constructive dismissal – as occurred in this particular case.
“A failure to understand the rules relating to the protection of employees’ rights, is one of the most common reasons why companies end up in front of an employment tribunal – which can be costly both in terms of financial penalties and the loss of business reputation.”
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