How should a tribunal assess compensation for unfair dismissal if the dismissed employee is incapable of finding another job because of illness? Richard White explains and considers a recent case in relation to this issue.

The conventional view of calculating unfair dismissal compensation for sick employees is that s/he should only receive compensation for loss of earnings sustained by the dismissal itself.

If the employee is ill and on sick pay, or has exhausted sick pay, their compensation will be modest or nothing because their earnings loss results not from the dismissal, but from their illness.

But what if the employee was made ill by the employer’s conduct? If the employer has made them ill, should the unfair dismissal compensation include loss suffered in consequence of the reduced income-earning capacity when it had been caused by the employer?

GAB Robins UK Limited v Gillian Triggs

The employer was a nationwide firm of chartered loss adjusters. Mrs Triggs commenced working for them at their Romford office on 6 September 1999 as a secretary/personal assistant to two investigators, Mr Carter and Mr Woffindin. She was a conscientious and loyal employee, who shouldered an excessive workload and put in long hours without extra pay in order to provide the necessary support to the two investigators.

From about April 2001, Mr Carter raised with his manager, Mr Baldock, the problem of her workload. On 6 August 2003 Mrs Triggs collapsed at home, following which she was signed off work for a week with stress. Although the two investigators continued to raise the matter of her workload with Mr Baldock, she remained overworked. In addition, she found Mr Baldock’s treatment of her as amounting to bullying.

On 30 September 2004, Mrs Triggs returned to work after two days’ sick leave and had to suffer Mr Baldock shouting at her down the telephone. She decided she had had enough. She left the office that morning, never to return. Her doctor signed her off sick with stress and depression, later diagnosed as anxiety and depression. No-one from senior management contacted her. She became frightened to go out alone and spent time at home sobbing uncontrollably and sleeping for long periods.

In December 2004, Mrs Triggs lodged a grievance, alleging long term bullying and overwork. A grievance meeting was held on 26 January 2005, which lasted two hours and during which Mrs Triggs outlined all of her allegations of bullying and overwork.

The employer’s response to the grievance was outlined in a letter dated 9 February 2005. It did not address the issue of Mrs Triggs’ workload. As for the complaint against Mr Baldock, the employer proposed that, before returning to work, Mrs Triggs should have an informal meeting with Mr Latimer, Mr Baldock and herself, with a view to trying to resolve the differences.

Mrs Triggs believed that the employer had effectively ignored her grievance and so, on 15 February 2005, she resigned to bring a claim for constructive dismissal. At the time of her resignation she was on statutory sick pay (SSP).

The decision

The employment tribunal found that Mrs Triggs had been constructively dismissed. In relation to compensation, the issue was whether her loss of earnings should be calculated on the basis of the SSP she would have continued to receive from her employer if she had not resigned, or whether her loss should be assessed on the salary she would have enjoyed if her employer had not made her ill.

The tribunal adopted the more generous calculation but its decision has been reversed by the Court of Appeal. The Court ruled that it was not open to the tribunal, in assessing compensation for her unfair dismissal, to have regard to pre-dismissal conduct.

The assessment must be confined to compensating her for the loss sustained by the dismissal itself, namely (in this case) compensating an employee who at the time of dismissal was already ill and on sick pay. Hence, Mrs Triggs’ compensation was calculated based on the SSP that she would have continued to receive had she not been dismissed.

Despite the fact that the employer’s conduct had caused her to be off sick, it was not possible for Mrs Triggs to obtain compensation for unfair dismissal based on her normal salary.

Comment

A comment made by the Court of Appeal was that the “instinctive sympathy” that might be felt for Mrs Triggs could not get in the way of principle. In unfair dismissal cases, compensation can only be awarded for losses that are caused by the employee’s dismissal.

Whilst this may seem to produce an unjust outcome for Mrs Triggs, employers should not think that if their employees are bullied and overworked to the extent that they go off sick and then resign, they are safe from large compensation claims.

There are, of course, other claims that could be pursued, such as personal injury claims for stress at work, claims under the Protection from Harassment Act 1997, or claims under the raft of discrimination legislation (provided the reason for the treatment was one of the prohibited discriminatory grounds).

The above case also does not mean that calculation of compensation in these type of cases will be straight forward. It may still be difficult to calculate compensation, in situations where it is unclear whether the fact of dismissal was really the last straw that proved too much for the employee, or whether the onset of the illness occurred before the dismissal.

For further advice on this topic, please contact Richard White, specialist employment solicitor at Withy King, on 01225 352 921 or email: richard.white@withyking.co.uk.