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Peninsula’s Problems: Round Two – Constructive Unfair Dismissal

12th January, 2018

HR Consultancies are widely used by businesses as they are often (wrongly) perceived to offer a cost saving in comparison to solicitors and barristers. A well known HR Consultancy, Peninsula, last year faced claims of constructive unfair dismissal, age discrimination, disability discrimination, non-payment of holiday pay and non-payment of commission. The judgement in the case of Tarbuck v Peninsula Business Services Limited Case No: 2404056/2014  was issued in May although it has only recently been published.

Some of you may recall our article, published in March 2017, entitled “Peninsula’s Problems”, reporting on the disability discrimination case that one of Peninsula’s former employees brought against them (it can be found by clicking here ). It appears that Peninsula has faced troubles with their employees once again in this most recent case.

Mr Tarbuck began employment with Peninsula in 1999 as a salesman. Mr Tarbuck was paid a basic salary of £8,500 and had the opportunity to receive 15% commission, provided he met an uplift target which meant he had to achieve sales of £75,000 per quarter.

During Mr Tarbuck’s time with Peninsula, he unfortunately suffered from a number of health issues, mainly in relation to his heart. In or around June 2013, discussions took place which led to a new team of salespeople being created; the Ambassadors Team. Mr Tarbuck’s health (along that of a colleague of his) was in part the motivation behind creating the team. Peninsula had an interest in retaining two successful members of staff and, therefore, creating this team and making changes to their terms and conditions was a way of doing this. Two key changes were made to terms and conditions. Firstly, a failure to meet sales targets would not result in disciplinary action for them. Secondly, the uplift target would be removed and the commission on sales would be payable at the full rate, not halved, if there was a failure to achieve a minimum volume or value of sales in a quarter. The new terms and conditions were confirmed in writing, accepted by Mr Tarbuck and took effect from 1 July 2013.

In January, Peninsula wrote to Mr Tarbuck and his colleagues, seeking to make changes to their terms and conditions by revoking the removal of an uplift target. During a meeting with Mr Tarbuck’s Line Manager, he was told that his “days will be numbered” if he did not sign the new terms. Mr Tarbuck was subsequently signed off work with chest pains but returned on 3 March 2014 at which point he did agree to the new terms.

Following his agreement, Mr Tarbuck felt like he suffered a number of detriments and during the hearing he highlighted five issues:

  1. Experienced telesales staff were removed from his team;
  2. He was not allocated a company seminar;
  3. His Line Manager stopped communicating with him;
  4. He was given poor quality leads; and
  5. He was provided with poor quality appointments.

As a result, Mr Tarbuck resigned on 7 July 2014. The Employment Tribunal concluded that Peninsula had breached the implied duty of trust and confidence which entitled Mr Tarbuck to resign. The Tribunal went on to say,

“…in reality this was not a straightforward commercial decision to alter contract terms. It was rather an exercise in resiling from terms recently agreed with the claimant. No potentially fair reason was established by the respondent. Even if it had been, the Tribunal concludes that the dismissal was unfair in all the circumstances of the case and under s98(4) ERA. No employer acting reasonably would have dismissed the claimant in the manner in which this claimant was dismissed.”

Peninsula unfairly dismissed Mr Tarbuck by way of forcing him to resign through their conduct.

Mr Tarbuck’s claims for age and disability discrimination were dismissed but his claims for unlawful deduction from wages/breach of contract (non-payment of commission) and non-payment of holiday pay were successful.

We note again that Peninsula, who describe themselves as the leading HR, employment law and health and safety consultancy, decided to instruct an external barrister to represent them, their own team not being used. Mr Tarbuck self-represented.

We repeat that our view is that HR always has its place, but that is not doing the work of solicitors or barristers. And perhaps Peninsula’s pain demonstrates the benefits of taking legal advice earlier from a solicitor or barrister.

If you need Employment Law advice and solicitor led expertise, please contact our Employment department.

Paul Bennett

Partner in Employment Law and Professional Practices
Email: [email protected]
Tel: 01743 453685

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