A FAILURE TO DO SOMETHING CAN BE A BREACH OF TRUST AND CONFIDENCE
Thursday 12th November 2020
In Nair v Lagardere Sports and Entertainment (UK), the High Court highlighted that a failure by an employer to do something can amount to a breach of the implied term of trust and confidence, just as a positive action can.
Employment law requires employees and employers not to conduct themselves in a manner likely to destroy or seriously damage the relationship of trust and confidence between them. This case highlights that ‘conduct’ can be passive, taking the form of a failure to something.
The claimant was employed by the World Sports Group (WSG) from 2006 and sought bonus payments of over $25m from WSG Hong Kong and WSG Singapore. He moved to the defendant (another company in the WSG group) in 2015. He claimed he was strung along in respect of the bonus payment until he had enough and resigned in 2017.
He then brought a claim for breach of contract against the defendant in relation to the bonuses, arguing that the implied term of trust and confidence required the defendant to take reasonable steps to ensure that WSG Hong Kong / WSH Singapore paid the bonus.
In dismissing an application to strike out the claim, the judge noted that the test was whether in all the circumstances the employer conducted itself so as to destroy or seriously damage the relationship of trust and confidence without reasonable or proper cause. That conduct could take the form of a failure to do something, although whether a failure is a breach of the term will depend on the facts.
This is not a change of the law but a useful reminder that a failure to act can result in employees resigning and successfully claiming constructive dismissal. Things such as failing to deal with a grievance, failing to make a payment, failing to make reasonable adjustments or failing to deal with alleged bullying/discrimination can all result in employees successfully claiming constructive dismissal.
If you would like to discuss this further, then please contact a member of our employment team. To view the rest of our November Employment Law Update, click the button below.