Western Excavating v Sharp [1978] ICR 221

• Plaintiff was suspended for taking absence without permission. This put him in financial hardship and his request to get his holiday pay early or to get a loan were refused. He therefore left the company so that he could get his holiday pay immediately.

• He sued for unfair dismissal and the question was whether or not he had in fact been dismissed, by virtue of s.95(c).

• His claim was dismissed, the CA applying a test of whether the employer had breached a fundamental term of the contract.  i.e. question of whether Plaintiff had been constructively dismissed (per s.95(c)).

Lord Denning MR

• Employer must be guilty of conduct which is a significant breach going to the root of the contract or which shows that the employer no longer intends to be bound by one of the essential terms of the contract.

• In such a case the employee is entitled to consider himself discharged from any further duties. He can terminate the contract by reason of the employer’s conduct.

• However the conduct must be sufficiently serious and the employee must leave soon after the conduct of which he complains occurs or he will be treated as affirming the conduct.

• He rejects a test of ‘unreasonable’ or ‘unfair’ conduct by the employer in favour of the contractual test that he mentions above.