EAT finds that constructive dismissal is capable of constituting an act of harassment

In Driscoll v V&P Global Ltd and another UKEAT/0009/21/LA, handed down on 15 July 2021, the Employment Appeal Tribunal (EAT) held that constructive dismissal is capable of constituting an act of harassment under the Equality Act 2010.

In recent years, we at Farore Law have dealt with a number of constructive dismissal cases that overlapped with harassment and discrimination. The Driscoll case is an interesting one given its relevance to our work and the fact it departs from previous EAT case-law, setting a new precedent in this area of law.

Background

The Appellant began working for the First Respondent, a legal recruitment consultancy, as an executive assistant/operations manager on 2 April 2019. The Second Respondent was the founder and Chief Executive of the First Respondent. As part of her claims, the Claimant asserted that throughout her employment she had been subjected to comments by the Second Respondent that constituted harassment related to sex, race or disability, contrary to section 26 of the Equality Act 2010 (EqA). This culminated in her resignation by reason of constructive dismissal in July 2019. She also brought claims for victimisation and a breach of the duty to provide written particulars of employment.

 A key issue in the case was whether constructive dismissal was capable of amounting to an act of harassment contrary to s26, EqA. S26(1) of the Act states as follows:

“26 Harassment

(1) A person (A) harasses another (B) if—

(a) A engages in unwanted conduct related to a relevant protected characteristic, and

(b) the conduct has the purpose or effect of—

(i) violating B’s dignity, or

(ii) creating an intimidating, hostile, degrading, humiliating or offensive environment for B.”

Employment Tribunal (ET)

In Ms Driscoll’s case, the ET held that it was bound by Timothy James Consulting Ltd v Wilton [2015] IRLR 368, EAT and Urso v Department of Work and Pensions [2017] IRLR 304, EAT, in its conclusion that constructive dismissal could not constitute an act of harassment. Ms Driscoll appealed to the EAT. The EAT, unlike the ET, would not be bound by those decisions and could depart from them if it saw fit.

Employment Appeal Tribunal (EAT)

In her analysis, Ellenbogen J, sitting in the EAT, started by setting out the authorities. She noted that in Wilton, the EAT held that although three incidents of harassment related to sex had led the claimant to resign, the application of harassment as prohibited conduct in the context of employment (in s40, EqA) did not include a resignation amounting to constructive dismissal. It was therefore not open to the Tribunal to find that that constructive dismissal had been an act of harassment, contrary to s26. This was then relied upon in Urso where the EAT held that an ‘actual’ dismissal was also incapable of amounting to harassment. [56]-[62]

Ellenbogen J then set out a number of relevant EU Directives and summarised them by stating that each expressly encompassed harassment within its definition of discrimination, and also applied in relation to dismissals. Further, she accepted the Claimant’s submission that the CJEU has long held the term ‘dismissal’ to be ‘widely construed’; for example, in Marshall v Southampton and South-west Hampshire Area Health Authority (Teaching) [1986] ICR 335, it was held to include an age limit for the compulsory dismissal of workers, as part of a wider retirement policy. [63]-[69]

Ellenbogen J then held that “in order to confirm with the obligations which I have concluded to be imposed by the Directives, the EqA must be construed so as to proscribe harassment in the form of dismissal including constructive dismissal.” She also noted that if claimants were able to plead constructive dismissal as an act of harassment, they may be protected from limitation defences that would otherwise have been available to the Respondent were time not able to run from the date of constructive dismissal. [71]

She held that there was no difficulty in construing s26, EqA in this way as it “provides for no express limitation of the type of ‘unwanted conduct’ which can and cannot constitute an act of harassment, as long as that conduct is related to a relevant protected characteristic and has the purpose or effect stipulated by section 26(1)(b).” Therefore, “a non-constructive dismissal can fall within the ambit of section 26, notwithstanding the absence of express wording to that effect.” [72]

She went on to hold that Wilton had thus not been correctly decided and it was appropriate to depart from it in this case. Ellenbogen J summarised her ultimate finding as follows: “as a matter of law, where an employee (as defined by the EqA) resigns in response to repudiatory conduct which constitutes or includes unlawful harassment, his or her constructive dismissal is itself capable of constituting ‘unwanted conduct’ and, hence, an act of harassment, contrary to sections 26 and 40 of the EqA. Whether or not it does so in the particular case will be a matter for the tribunal to determine.” [75]

Comment

This case will be a welcome development for harassment claimants, who will now be able to plead constructive dismissal as an act of harassment. Ellenbogen J’s decision also brings the case-law in this area back in line with EU law, given her finding that Wilton was decided without proper regard to the relevant Directives. This decision will also be beneficial from a limitation perspective – where harassment claimants wish to rely on the principle contained in s123(3)(a) of the EqA that “conduct extending over a period is to be treated as done at the end of the period,” the time limit will now run from the date of any constructive dismissal, rather than from the date of a prior act of harassment. For some, this may mean the crucial difference between being inside or outside the 3-month time limit.

Driscoll does not directly address the question of personal liability, i.e. whether an individual employee can be held personally liable for constructive dismissal when pleaded as an act of harassment. Unfair and/or constructive dismissal is a claim that can usually only be made against an employer, involving as it does a finding of a fundamental breach of contract. Where the fundamental breach is the result of an employee’s actions, the employer will be held vicariously liable.

Ellenbogen J’s judgment suggests that constructive dismissal harassment could only be pleaded against an employer. For example, she says the following at paragraph 71: “A claimant who can rely upon only those acts of harassment which give rise to a constructive dismissal is potentially exposed to a limitation defence which would not be available to the respondent employer if the dismissal itself could be advanced as an act of harassment.” However, this is not directed at the specific point, nor does she rule on it explicitly anywhere else in her judgment.  It is perhaps arguable that any resignation arising from unfavourable treatment by a fellow employee should be seen as a detriment meted out to the claimant, and as such give rise to a claim under s13 (discrimination), s26 (harassment), or s27 (victimisation, if a complaint of harassment or discrimination has been made) of the EqA. Others, however, might argue the resignation is merely a response to the discriminatory act, not an act of discrimination or harassment in of itself.

Whilst it may therefore be unlikely that constructive dismissal harassment could be pleaded against an individual employee in a personal capacity, Driscoll does not strictly rule it out. Such a possibility would likely be welcomed by claimants given the limitation issue that arises otherwise: if constructive dismissal cannot be included as part of a harassment claim against an individual respondent, time would begin to run from the last act of harassment itself, which may be much further in the past and therefore out of time. It remains to be seen how this point will be dealt with by future Tribunals.

The EAT judgment can be found here.