Mutual trust and confidence

In Malik & anor v Bank of Credit and Commerce International SA (in compulsory liquidation) 1997 ICR 606 (Brief 592) the House of Lords finally confirmed the existence of a term which the lower courts and tribunals had been using and developing for many years, namely that the employer will not, ‘without reasonable and proper cause, conduct itself in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between employer and employee’. While the duty is on both sides – trust and confidence must be mutual if the employment relationship is to work – most cases where it is raised are constructive dismissal cases brought by employees alleging a breach by the employer.

Disciplinary matters

Mutual trust and confidence can be undermined by the way in which an employer carries out a disciplinary procedure. In Alexander Russell plc v Holness EAT 677/93 EAT upheld a tribunal’s finding that an employer had been oppressive in summoning an employee to a disciplinary hearing and giving him a final written warning for poor timekeeping, where he had been given a written warning for the same thing only 24 hours earlier. Such treatment might have been appropriate, however, where the complaint was one of gross misconduct.

Employers should exercise caution when suspending an employee, even where it is specifically permitted by the contract. In Gogay v Hertfordshire County Council G, a residential care worker, was suspended pending investigations into alleged sexual abuse of a child with learning difficulties, which later turned out to be unfounded. G suffered psychiatric illness as a result of the suspension and investigation, and was unable to return to work.

The Court of Appeal held that to accuse someone of sexual abuse was likely to destroy or seriously damage the relationship of trust and confidence, and that the Council had no reasonable and proper cause for their actions. The information given by the child had been vague and, although further investigation was required, it could not be said that the allegation necessarily involved sexual abuse. The Council should have considered whether it was necessary to separate G from the child and, if so, whether some form of action other than suspension could be contemplated, such as a temporary transfer to other work, or a short period of leave.

Impossible tasks

In Hellman International Forwarders Ltd v Cooper EAT 1040/96 an employee was told that if she did not complete an enormous backlog of paperwork within a fortnight she would lose her job. She resigned, and the tribunal found that the task would have been impossible. EAT upheld the tribunal’s finding that she had been constructively dismissed.