Appeal No.	 EAT/0743/01

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 17 April 2002

Before
HIS HONOUR JUDGE J R REID QC
MS J DRAKE
MR I EZEKIEL

MR P SMITH	APPELLANT

UNITED ASSURANCE EMPLOYEE SERVICES LTD	RESPONDENT

Transcript of Proceedings

JUDGMENT

Revised

	APPEARANCES

For the Appellant	MR M PAGET
(of Counsel)
Messrs Irvin Mitchell Solicitors
Imperial House
31 Temple Street
Birmingham
B2 5DB	
For the Respondent	MR A LOCK
(Employed Barrister)
Messrs Breachcroft Wansbroughs Solicitors
10-22 Victoria Street
Bristol
BS99 7UD	

HIS HONOUR JUDGE J R REID QC

1	This is an appeal from a decision of an Employment Tribunal held at Brighton.  The hearing took place on 19 and 20 February 2001.  The decision was sent to the parties on 
6 March 2001.  By the decision the Tribunal held that the Applicant, Mr Smith, was not unfairly dismissed and the application was dismissed.

2	The facts are in a fairly short compass.  Mr Smith began working for the predecessor of the Respondent in November 1984 (the decision refers to that as being in 1994 but it is clear that that is simply a slip of the pen because it was common ground throughout that the commencement date was November 1984).  In February 2000 the decision was taken that the number of appointments that sales managers employed by the Respondent should make in the course of a week should be fifteen.  Hitherto the custom had been for some eight or ten appointments to be kept each week.  

3	On 4 February 2000 Mr Dixon, the Regional Sales Manager, and Mr Pearson, his Sales Director, determined that there should be a requirement to undertake fifteen appointments a week and sent out a memorandum to, amongst others, Mr James.  Mr James was the line manager of Mr Smith and he was the Branch Manager of the Crawley office from which Mr Smith worked.  The decision to increase the number of appointments was not one that was welcomed by Mr James and he did not immediately inform Mr Smith of it.  However, the requirement for fifteen appointments a week was said to be mandatory and it was said would have to take place with immediate effect.  The result of this was that eventually, on 
29 March, Mr James saw Mr Smith, showed him the memorandum and received from Mr Smith a protest that the requirement was unreasonable, to which Mr James’ response was:

 “The best thing you can do is look for another job”.  

4	Between 29 March and his eventual resignation on 3 June, Mr Smith, in fact, carried on making appointments at the rate of eight to ten a week.  The reason for this was because he took the view that an increase in the number of kept appointments to fifteen appointments a week was unreasonable and that the additional administration and other matters arising from it would increase his workload by something like fifty percent.  During that period, something just over two months, Mr Smith had fourteen days off by way of holiday and by way of a few days of sick leave following on to his holiday.  He made no protest beyond his initial protest when he was shown the memorandum, nor, on the other hand, did the employer take any dramatic steps to enforce the requirement for fifteen kept appointments a week.  

5	The most that appears to have been done, in the face of Mr Smith’s disapproval of the alterations, and Mr James not, so far as the evidence goes, doing anything substantive to enforce the new requirements, was for a memorandum from Mr Pearson to be sent to area sales managers which said, amongst other things:

“The standard is 15 kept appointments per week, again there is much improvement by some …… but not all.  This will not go away.”

6	The Tribunal held, and it is not challenged, that the imposition of the fifteen appointment criteria was a fundamental breach of the terms of Mr Smith’s contract of employment, but, and this is where the problems arises which is the subject of this appeal, the Tribunal went on to hold that Mr Smith had lost his right to treat himself as discharged from the contract by reason of this fundamental breach because he had not taken steps earlier to treat the contract as at an end and because he had carried on working for some two months.  

7	It is against that decision that Mr Smith now appeals.  He takes two points. Firstly, it is said that he could not be said to have affirmed the new conditions without ever having worked them because he continued to work as under the old contract and that in those circumstances the decision that he had affirmed the contract and lost his chance to treat it as an end was wrong in law.  Secondly, it is said that even if his mere presence working at the old rate could have been enough to affirm the contract, then he had not lost the right to terminate the contract merely by carrying on for a space of about two months.

8	Dealing with the first of those points: the position was that his employers were now requiring him to work fifteen kept appointments a week.  He did not indicate that he was not going to do that.  It is true that he did not keep up with what he should have been doing but what he did not do was say ‘I am not prepared to accept your repudiation of my contract, I am going to carry on working at the old rate’.  Of course, had he done that, and had it been his intention to assert that he was still performing the old contract, then he would have been in no position to resign in June because there would have been no reason for him to resign whilst he continued to work under the old contract.  In effect, and this was the basis on which the matter was argued below, the only question was whether the combination of factors, his continuing to work, his failure to protest, the lapse of time and the failure to invoke the grievance procedure or the assistance of his trade union, when taken together, was such that he could no longer assert that he was entitled to treat the contract as having been discharged by breach.

9	That was a matter which the Tribunal looked at with considerable care.  They took the view that the combination was such that he had lost the right to treat himself as discharged.  We were referred, in the course of argument on this point, firstly to Western Excavation (ECC) Ltd v Sharp in which at paragraph 15 of 1978 IRLR page 27, Lord Denning, the then Master of the Rolls, said:

“If the employer is guilty of conduct which is a significant breach of 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.  If he does so, then he terminates the contract by reason of the employer’s conduct.  He is constructively dismissed.  The employee is entitled in those circumstances to leave at the instant without giving any notice at all or, alternatively, he may give notice and say he is leaving at the end of the notice.  But the conduct must in either case be sufficiently serious to entitle him to leave at once.  Moreover, he must make up his mind soon after the conduct of which he complains: for if he continues for any length of time without leaving, he will lose his right to treat himself as discharged.  He will be regarded as having elected to affirm the contract.”

Secondly, we were referred to the decision in Bashir v Brillo Manufacturing Co [1979] IRLR 295, in particular, passages in the judgment delivered by Mr Justice Slynn, as he then was, at paragraphs 15 and 16 where is was said:

“It seems to us that here if Mr Bashir had gone back and had worked for a period without evincing his acceptance of the repudiation, then clearly it would have been too late for him to bring a claim for constructive dismissal.  But through the period Mr Bashir, or his advisors, were here saying, very positively, that he did not accept the new position which the employers sought to offer him.  There is only one matter which can be relied upon by the company to suggest that he had in any way affirmed the contract.  That is the application for, and the receipt of, sick benefit paid by the company, which is accepted by both sides to be consistent with the continuation of a contract of employment.  Indeed both sides were saying, right to the end, that Mr Bashir was still employed by the company.
But that does not, of itself, seem to us to be necessarily fatal to Mr Bashir’s claim.  It seems to us that when the Master of the Rolls is talking about the employee continuing for any length of time without leaving he is referring to a situation where the employee actually does the job for a period of time without leaving, or if he does some other act which can be said to affirm the contract as varied.  The most that can be said her is that Mr Bashir, by applying for and taking the sick benefit, was affirming the existence of a contract of employment.  He said it was employment as a supervisor and he would accept no employment at a lesser wage.  But because the amount of sick pay is the same for a supervisor as for a labourer or other worker in the kind of job which Mr Bashir might have done, it does not seem to us that it can be said that by the receipt of sick pay he had done an act to affirm the contract as varied.”

10	The difference, it seems to us, between Bashir and this case is that Bashir was a case where Mr Bashir was on the one hand, protesting, and on the other hand, simply receiving sick pay at a rate equally consistent with either the old or the proposed new terms of employment, whereas here it was open to the Tribunal to look at the totality of the circumstances, the continued working, which was not (as it would have been in Mr Bashir’s case) working on a different job but simply working rather less hard than the employer would have liked in the same job, the failure to protest, the failure to invoke a grievance procedure or the assistance of the trades union.  Looking at all of those, the Tribunal, in our judgment, were entitled to say indicated that Mr Smith was continuing to hold himself to the contract of employment when he could have treated it as being at an end.  In those circumstances, it seems to us that the Tribunal were entitled to say, as they did, that what he had done was to affirm the existence of a contract and that as such he had lost his right to treat himself as discharged.

11	The second point was that even if what Mr Smith had done might have been thought to be enough to indicate affirmation of the contract, nonetheless the period of two months before his resignation was not such as to show unequivocally that he had affirmed the contract and that he could, so to speak, be taking the new contact on approval during the whole of that two month period so that at the end of the two months when he did in fact resign it was still open to him to do so.  The position in this case is that, in fact, the Tribunal looked at all the factors together.  In particular, they took account, as one of the factors, of the two month period.  It does not, it seems to us, lie with the Employment Appeal Tribunal to say that the Employment Tribunal could not have thought that two months was in excess of any trial period.  It was urged upon us that the length of Mr Smith’s employment from 1984 meant that it was unreasonable to expect him to have made up his mind finally within a two month period, but that is but one element of the various elements that the Tribunal took into account.  We were referred to a number of cases in relation to this, for example, G W Stephens v Fish [1989] ICR 324, The Post Office v Roberts [1980] IRLR 347 and Air Canada v Lee [1978] IRLR 392.  Those cases all demonstrate that there is no absolute period that one has to look at the absolute totality of the circumstances and that the length of time before the acceptance of repudiation is only one of the factors that the Tribunal has to take into account.  

12	Here, the Tribunal clearly took into account a variety of matters.  There is no indication that they left out of account any matter which they should have taken into account, or that they took into account any matter which they should not have taken into account.  Nor, in our judgment, can it be said that the conclusion to which they came was a conclusion to which no reasonable Tribunal could have come.  The two month period was one of the factors and it cannot be said that saying that the passing of two months together with the other matters taken into account in determining that Mr Smith was no longer entitled to accept the repudiation was in any way perverse.  In those circumstances, the two grounds that have been raised fail.  The appeal will therefore be dismissed.