A family (business) at war

If, like me, you have been enjoying Kay Mellor’s comedy drama Girlfriends on ITV, you may have cringed at some of the artistic licence deployed when dealing with aspects of the age discrimination claim being brought by Miranda Richardson’s character against her boss (and lover), played by Anthony Head. However, it has neatly highlighted the particular difficulties that can arise when workplace disputes get a bit too close to home.

A real life family dispute has been playing out in the Manchester Employment Tribunal and, more recently, in the Employment Appeal Tribunal. There is a major clue in the name of the case: Mrs J Feltham, B Feltham (Maintenance) Limited and Ms H Feltham v Feltham Management Limited, Mr D Feltham and Mr M Feltham. Feltham Management is a long established family business, specialising in property management, particularly in respect of student lettings. Jane Feltham is the claimant. She has three brothers, David, Martin and Stephen, all of whom were respondents in the Employment Tribunal claim. They all worked for the family business which was founded by their father. Hazel, the adult child of David, worked for the company as a clerical assistant and Jane’s husband was Mr Eckersall, a self-employed joiner who did work for the company.

In August 2013 it came to light that Mr Eckersall had been sending inappropriate texts and Facebook messages to his niece, Hazel. On the same day he told his wife, Jane, that he was leaving her because he had feelings for Hazel. Jane confronted Hazel, accusing her of inappropriate conduct, but she denied that she had done anything wrong. Jane’s brother David got involved and told Jane that if was her fault because she did not take Mr Eckersall’s name on marriage, did not respect him as head of the household and suggested that these (among other reasons) were why he wanted Hazel. Jane was upset and left work. She did not return.

With support from David, Hazel took over Jane’s duties as office manager. The company stopped paying Jane from the end of August, but she remained a director as well as continuing to receive benefits including a company car and credit card.

can there be a finding of contributory fault following a constructive dismissal?

In Frith Accountants Limited v Mrs J Law the relatively narrow questions for the Employment Appeal Tribunal were whether someone who has been constructively dismissed can be held to have contributed to that dismissal, whether the basic award should have been adjusted to take into account the employee’s conduct and whether the assessment at 40% of the prospect of future dismissal was too low.

However, the case is noteworthy since, as observed by EAT President Mr Justice Langstaff, it “may be the first [appeal] case to deal with an alleged contribution by an employee where the breach of contract by the employer was a breach of the implied term of trust and confidence”.

Mrs Law worked in an accountant’s office and was aged 62 at the date of her dismissal. She had performed well at a performance review in 2011 but did not receive a pay rise in 2012 as a result of concerns about her performance. She accepted that she had been late in filing returns with HMRC but thought that this was an easy mistake to have made. She disputed other alleged errors. Instead of treating the matter as one of performance management and undoubtedly unwisely but equally with good intentions, Mr Frith, a principal of the practice, decided to raise his concerns with Mrs Laws’ son. As the Tribunal had said, this was not the way to go about such matters!

Unsurprisingly Mrs Laws was horrified when she found out and she resigned. Equally unsurprisingly the Employment Tribunal found that this was a constructive unfair dismissal. However, even if Mrs Laws had made errors and was unwilling to accept criticisms, these actions could be said to have contributed to the employer’s action in breaching the duty of trust and confidence. Mr Justice Langstaff noted that it will be unusual for a constructive dismissal to be caused or contributed to by an employee, since it is based on a breach of contract by the employer. Further since a constructive dismissal results from a “fundamental” breach of contract by the employer “then not only will it be repudiatory, but by definition there will be no reasonable or proper cause for the employer’s behaviour”. However, although the question of constructive dismissal is answered by seeking to establish a fundamental breach of contract, the question of compensation is dealt with by statute and covers all dismissals, including constructive dismissals.

However, in this case the Tribunal had summarily dismissed the possibility that Mrs Laws had contributed to her dismissal. Mr Frith’s decision to act as he did was “a matter entirely for him”. There was therefore no causal connection between anything done by Mrs Laws and the action taken by Mr Frith which resulted in her dismissal.