Former Manager Awarded €40,000 in Successful Constructive Dismissal Claim

Former Manager Awarded €40,000 in Successful Constructive Dismissal Claim. In Caroline McGarry v JTI…

In Caroline McGarry v JTI (Ireland) Ltd ADJ-00041399, the Complainant, Ms McGarry, brought a claim to the Workplace Relations Commission (the “WRC”) that she was constructively dismissed from her employment in the Respondent tobacco company. She claimed that the conduct of the Respondent was such that she had no option but to resign from her role of thirteen years.

Facts: The Complainant was employed by the Respondent from 2008 to September 2022. At the time of her resignation, her role was Trade Activation Manager Digital. The Complainant described that over 2018/2019, there was a restructuring and reduced headcount in the Respondent which resulted in additional work and pressure for the Complainant. From 2020, resources in the Respondent company decreased while the Complainant’s workload increased. She was working long hours and raised concerns over resources and her heavy workload. The Complainant said that her health began to suffer as a result of work-related stress. Despite raising concerns with her line manager and senior management, the Complainant did not feel that she had their support. In 2021, the Complainant started to experience anxiety attacks and panic waking, and was certified by her doctor as unfit for work for a period. She was prescribed medication and began seeing a counsellor. Later in 2021, occupational health deemed the Complainant unfit for work for a further period.

Following a review in June 2021, the Complainant began a phased return to work. During this time, she attended weekly meetings with Ms Crotty. The Complainant was open with Ms Crotty about her health and her work. She also made a number of requests and proposals to help with managing and prioritising her workload, to no avail. When the Complainant returned to full-time work, Ms Crotty reassured her that she should only take on what she was able to do. The Complainant told the WRC that her work was busy. but she was doing what she was capable of, and was working to her capacity. The Complainant asked Ms Crotty about what work she should prioritise.

Ms Crotty held a performance review meeting with the Complainant in January 2022. This meeting went badly for the Complainant, and she suffered an anxiety attack afterwards. She emailed Ms Crotty about the performance review and set out her perspective on the feedback she received. She could not recall whether she told Ms Crotty that she was suffering from work-related stress at this time.  A further meeting took place and the Complainant raised her concerns to which she was reassured that she has the support of the Respondent. The Complainant’s performance review report concluded that the Complainant’s performance “needs improvement”. Her position on the Respondent’s talent matrix was downgraded  from a “key player” to an “inconsistent player”. This came to the Complainant’s surprise as she has been open about her concerns and believed that the Respondent understood her position. She told the WRC that she had always been a key player and found this review period very difficult.

On 6^th April 2022, the Complainant was informed that she was to be placed on a Performance Improvement Plan (“PIP”) for six months. The Complainant wrote a letter to the Respondent’s People & Culture Director to make Human Resources aware of her circumstances. The letter was a request for help, to which she received a one-line response acknowledging receipt, which the Complainant found hurtful. The Complainant tried to engage with the PIP process, but had difficulty with it as she felt it was unfair and punitive. It was the Complainant’s view that a reasonable employer would have addressed why there was a dip in her performance rather than putting additional pressure on her. The culmination of events resulted in the Complainant suffering a panic attack after a PIP review meeting. She was certified unfit for work by her doctor for ten days and continued to take prescribed medication and seeing a counsellor. The Complainant felt she had to be medicated to do her job which was not something she could continue with. In order to protect her health and wellbeing, the Complainant informed her line manager that she was resigning on 2^nd June 2022, giving three months’ notice in accordance with her contract of employment. Ms Crotty expressed her surprise at the Complainant’s decision to resign, however the Complainant did not accept that her resignation was not foreseeable by the Respondent.

The Respondent replied to the claim by saying that it only became aware that the Complainant was suffering from stress when she submitted a medical certificate on 2^nd April 2021, which cited stress as the reason for her two-week absence from work. The Respondent did not agree with the Complainant’s version of events and claimed that it did everything possible to support her in her role. The Respondent submitted that the Complainant did not need to resign from her role, and instead could have engaged with the PIP process or utilised the internal grievance procedure. The Respondent also submitted that the Complainant did not bring certain issues to its attention in a timely manner. Ms Crotty gave evidence to say that she found it difficult to obtain information from the Complainant in their catch-up meetings. She said she was unaware that the Complainant suffered an anxiety attack after the review meeting on 20^th May. Ms Crotty did not agree that the PIP process was designed to exit the Complainant from the company.  It was her view that the Complainant failed to engage with the PIP. When the Complainant informed her in a meeting on 2^nd June 2022 that she was resigning, she said she was “shocked and surprised”.

Decision:

Constructive dismissal is included in the definition of “dismissal” at section 1(b) of the Acts, as follows: –

“the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer”

The Adjudicator outlined the “contract test” and the “reasonableness test”.

1. The Contract Test

The Adjudicator referred to the statement by Lord Denning MR in Western Excavating v Sharp [1978] ICR 221 where he said as follows:

“If the employer is guilty of conduct which is a significant breach 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 discharged from any further performance. If he does so, then he terminates the contract by reason of the employer’s conduct…[T]he conduct must…be sufficiently serious to entitle him to leave at once…”

2. The Reasonableness Test

The Adjudicator referred to the following statement of Lord Denning MR, also in the Western Excavating case:

“It is that the employer must act reasonably in his treatment of his employees. If he conducts himself or his affairs so unreasonably that the employee cannot fairly be expected to put up with it any longer, the employee is justified in leaving.”

The Adjudicator noted that there is also a reciprocal duty on an employee to act reasonably in providing an employer with an opportunity to address any issues.

The Adjudicator accepted that the Complainant raised concerns about her workload and low morale with her line manager as far back as 2018. The Complainant’s health started to suffer from late 2019, which became progressively worse until she was certified unfit for work in March 2021. A phased return to work began in July and for some time the Complainant felt comfortable that she was working within her capacity. However, in a performance appraisal for 2021, the Complainant received a rating of “needs improvement” and was subsequently placed on a PIP.

The Adjudicator was satisfied that the Respondent’s conduct from 2017 – June/July 2021 surrounding the Complainant’s workload, sick leave, and phased return to work was reasonable and in line with their obligations as her employer. However, the Adjudicator went on to find that it was reasonable for the Complainant to resign when she did, due to the Respondent’s conduct around the PIP and performance appraisal. The Adjudicator held that deeming the Complainant as an “inconsistent player” from the period she was returning to work after sick leave was “unfortunate and did not assist the situation”. The Adjudicator described the Complainant’s letter dated 25^th April 2022 as a “cry for help”. The Adjudicator  was satisfied that the letter clearly raised grievances in writing, which were not properly addressed or responded to by the Respondent. The Respondent remarked that “it was not necessary, either generally or having regard to the respondent’s policy, for the letter to expressly invoke the grievance policy.” The Adjudicator was satisfied that the Respondent was on notice of the significant difficulties that the Complainant was experiencing and that they ought to have addressed outside a PIP process. In the circumstances, the Adjudicator found that that the Complainant met the reasonableness test and that she had discharged the burden of proof. She upheld the Complainant’s constructive dismissal complaint.

The Adjudicator was satisfied that compensation was the most appropriate form of redress. The Complainant had not secured alternative employment in the period from September 2022 to March 2023. There was evidence of the Complainant having made various job applications. At the time of the WRC hearing, the Complainant had applied for 55 job, and attended approximately seven interviews within her area of expertise. The Adjudicator awarded the Complainant €40,000 in compensation, which was equivalent to approximately six months’ remuneration.

Takeaway for Employers: It is well established that there is a high bar to be met in a constructive dismissal claim. An employee is generally expected to utilise all internal procedures before resigning from their employment. However, in some cases, it may not be necessary for an employee to exhaust all internal grievance procedures in order to establish a claim for constructive dismissal. There is also an obligation on an employer to constructively engage with an employee where they are on notice of difficulties on the part of the employee. Here, the Complainant had formally raised issues with her manager over a prolonged period of time. If the Respondent  required  the Complainant to raise an official grievance, this should have been communicated to her at an early stage.

Link –  https://www.workplacerelations.ie/en/cases/2023/october/adj-00041399.html

Authors – Jane Holian, Jenny Wakely, Anne O’Connell