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25th October 2019

Cautionary tale of unfair dismissal for charities

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The recent case of Gifford v Shetland Care Attendant Scheme is a useful reminder of the potential pitfalls faced by charities and all employers if they do not properly plan, prepare or consult with employees when they want to change their job roles. Gifford worked as a part-time manager/coordinator for the charity and line-managed an administrator, Kate Fraser. Gifford objected when the charity proposed to give Fraser management responsibilities upon Fraser achieving a managerial qualification, naming her and Gifford as joint coordinators. The knock-on effect to Gifford’s role was that Fraser no longer reported to her and that her duties and responsibilities were to be shared between them.

Gifford went off sick with stress on 30 July 2018, after her formal grievance about the situation was dismissed by the charity. Her employment contract did not provide for sick pay and she was initially paid full pay during her sickness absence (consistent with the charity’s practice in this regard and the Shetland Islands Council policy that Gifford understood the charity had adopted). This was later reduced to statutory sick pay (and backdated by a month) and the previous 5 months’ sick pay were for the first time labelled by the charity as having been a ‘generous goodwill gesture’. This triggered Gifford’s decision to resign on 21 January 2019.

This unilateral and retrospective pay reduction was held by the Tribunal to have been the ‘final straw’ in a series of events, starting with the charity unilaterally and without consultation making material changes to Gifford’s job role and then failing to handle her grievance in accordance with its policy, which amounted to a fundamental breach by the charity of the implied term of trust and confidence, entitling Gifford to resign. Gifford’s dismissal was found to have been unfair on substantive and procedural grounds and the charity was ordered to pay her an unfair dismissal award of £17,862 and a sum of £1,228 in respect of the unlawful deduction from her wages.

The key points to draw out of this case are the importance of following fair procedures with employees, including with regard to consulting with them before making changes to their terms and conditions of employment and properly managing and addressing any grievances raised, and taking care to ensure that the correct level of sick pay is paid, according to the employee’s express or implied contractual entitlement.

It is very easy to overlook something when managing employees and the employment relationship. If you have any questions at all in this area, please contact Elizabeth Swinburn on 01223 447420 or at elizabethswinburn@hewitsons.com