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Case Law – be clear and honest about the reason for dismissal

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Rawlinson v Brightside Group

 

Remember the saying “honesty costs nothing, but lying could cost you everything”? Well, it seems the EAT confirmed this to be case recently, giving the true reason for a dismissal would have cost a lot less for the employer! Not being honest or indeed lying about the reason you dismissed an employee could prove expensive.

 

Background

Brightside, the employer, told Rawlinson he was being dismissed not because of his performance (although this was the reality as a result of a new Chief Executive joining the org and having immediate concerns about whether Rawlinson was up to the job) but because his role was going to be outsourced and that his duties were being reorganised.

 

Perhaps they thought this would soften the blow a little - the perception is that redundancy always feels a less personal reason for dismissal than criticising an employee’s performance and in fact, the Tribunal in this case remarked that it was fully aware that, in many similar situations, employers give employees an incorrect reason for terminating employment to make the news easier to swallow.

 

Another factor was that Brightside wanted Rawlinson to work out his three-month notice period to ensure a smooth handover, and thought a softer reason for dismissal might assist with this. So, they were somewhat serving their own ends by not stating the performance as the real reason.

 

This is where it went a little wrong for Brightside and they didn’t consider the bigger picture! Rawlinson was Brightside’s legal counsel and it was perhaps inevitable that he might start to ask questions about the imminent outsourcing. Rawlinson pointed out that the outsourcing would amount to a TUPE transfer. When he received little explanation or answers to his questions, he resigned claiming constructive dismissal as a result of a breach of the implied term of mutual trust and confidence.

 

Rawlinson then found out – from emails he received in response to a Subject Access Request (those dreaded things!)  – that the real reason for the termination of his employment was performance. The Chief Executive had said in an email that he had found three ‘red card’ mistakes and that there was no way forward in terms of Rawlinson’s future employment.

 

Rawlinson brought a claim against Brightside for payment of his notice period and compensation for failure to inform and consult under TUPE.

 

Tribunal Decision

 

Rawlinson’s his case did not succeed as the tribunal found him to be complaining about the manner of his dismissal. The case law is clear that it is not possible to receive compensation for a breach of contract in this situation.

 

EAT Decision

 

The EAT, however, reached a different conclusion as it considered that Rawlinson was not complaining about the dismissal itself but about the false information he had received about why he was being let go.

 

Rawlinson did not know at the time of his resignation that Brightside had lied to him, but the EAT decided that lie had provided him with a good enough reason for resigning and considering himself constructively dismissed.

 

What do we learn from this?

 

This case makes it clear that it would be a breach of the implied duty of trust and confidence if an employer misled an employee about the reason for bringing employment to an end.

 

In hindsight, it would have been safer for Brightside to give no reason at all - given it was not obliged to as Rawlinson did not have unfair dismissal rights i.e. 2 years service). If your employee has less than 2 years service sometimes it may be more beneficial remaining quiet!

 

Keeping an employee in the dark about why their employment is ending does not breach trust and confidence but telling a lie does, it seems. The judge in this case found that lie to be far more than a “white lie that serves some sort of benign purpose”. So, be transparent – or, if not, just avoid dishonesty. Or they have less than 2 years service, consider whether it’s worth saying nothing at all.


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