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Further appeal for woman unlawfully axed by family firm

3 Jan 2018 By PM Editorial

Tribunal will reconsider sex discrimination claim that followed inappropriate texts in feuding office

A woman who won claims for sex discrimination and unfair dismissal against her own family firm when her husband was treated more favourably than her after a family feud will face a reconsideration of her discrimination claim, the Employment Appeal Tribunal (EAT) has ruled.

Manchester-based Feltham Management was successful in part of its appeal against a sex discrimination claim after it stopped paying a female director but continued to pay her husband. The pair were absent for a prolonged period following the fall-out from the husband saying he wanted to leave his wife for her niece, who was also employed by the company.

In December, the EAT upheld the Manchester tribunal’s 2016 finding in Feltham Management Ltd v Feltham & Ors that the claims were in time, based on its decision on her date of effective termination.

However, the appeal judge remitted the tribunal’s findings of sex discrimination back for reconsideration, stating that it had insufficiently addressed the reasons the firm had withheld pay from the claimant but not from her husband, who also worked for the firm.

The claimant left the company for a period because of her husband’s and family members’ inappropriate behaviour at work, and, when she wanted to return, this was refused by her family. She maintained that she had not resigned from the firm, but they refused to pay her and stopped her benefits, arguing that she had resigned voluntarily. She won her unfair dismissal and sex discrimination claims, but the company appealed.

This case arose from a family dispute in which Feltham employed all of the family members except the claimant's husband, who worked as a self-employed contractor, but who triggered the claimant’s exit from the firm.

Four siblings – Jane, the claimant, and her brothers David, Martin and Stephen – worked at the family business, which their father founded.

Hazel, David’s adult daughter, also worked in the business as a clerical assistant and Mr Eckersall, the claimant's husband, a self-employed joiner, undertook work for it without being an employee.

The company employed Jane from 2002 as property lettings manager and director, and a company director, with a written employment contract from 2006. Until 15 August 2013, she was “regarded as a valuable and effective” management member, overseeing the office.

But a serious dispute occurred that day after Eckersall sent inappropriate texts and Facebook messages to Hazel, the claimant’s niece. Eckersall emailed Hazel asking her to call him, and then told the claimant he was leaving her because he had feelings for Hazel.

The claimant accused Hazel of inappropriate conduct with her husband. Hazel refused to accept she had acted wrongfully. Other family members became involved.

David told the claimant that the situation was “her fault because she did not take Eckersall's name on marriage, or respect him as head of the house, and undermined him in front of others, and did not welcome him home; perhaps that was why he wanted Hazel”, the judgment stated. The claimant, already upset, was further upset and left work without returning.

The tribunal did not make findings about Hazel’s behaviour with Eckersall. She deleted his messages and her replies and declined to give evidence on what she had said to Eckersall, although she denied wrongdoing, insisting on a retraction and an apology. She took over the claimant's work in the firm – with support from David.

The claimant and her husband became unwell but, while Feltham ceased paying the claimant at the end of August, it did not indicate termination of employment. She remained a director, with a company car and credit card.

In September, she apologised to Hazel for shouting, but Hazel refused to accept this. The claimant later told Stephen she would return to work the next Monday, but he refused this.

The tribunal found that she then attempted to resolve the issues. Hazel wrote a letter that the tribunal described as “unpleasant”. It stated: “Jane has not been sacked. She has not been given her P45. She voluntarily failed to return to work in the weeks after the event.

“She then announced to Stephen that she would be returning [to work] without the matter being resolved. This was and still is impossible. How can she or anyone else expect things to work after the accusations she had made without her even attempting to make amends – and actually meaning it?"

In June 2014, the claimant wrote a ‘measured’ letter to her brothers, suggesting mediation. It stated that she "was in a state of emotional turmoil and was not fit to come into work for three weeks [from the argument in August 2013]. Further, on speaking to Stephen three weeks after that fateful day, I explained to him that I was going to come back into work and was told that I couldn't come back until the situation was 'sorted out'.

“The fact that I had been told not to return until the matter had been sorted out should not then mean that I am penalised in terms of my pay. I do not accept the position that I have not been paid and, therefore, I expect to be reimbursed for all of my pay since that day in August 2013 and for my pay to be reinstated moving forward."

The brothers replied on 30 October, claiming: "You walked out of the business on Thursday 15 August 2013 and did not come back. The company took this as your resignation and as such your employment with the company ended on that date [...] There is, therefore, no entitlement for you to receive any salary from 15 August 2013 to the present time and you are not entitled to any salary going forward."

The claimant brought successful claims at the tribunal for unfair dismissal and sex discrimination, based on the fact that she was unpaid but her husband was paid during the time they were both off work ill. The tribunal found she had suffered sex discrimination.

The tribunal also found that she was unfairly dismissed as the company lacked a fair reason. It found that she had not contributed to her dismissal and no deduction for contributory conduct was appropriate. She was effectively dismissed on December 2014 – when Feltham told her she had been taken off the payroll and a P45 had been issued – which meant her claims were in time. It rejected the company’s attempt to time bar her claims by arguing that her dismissal took place earlier.

Feltham appealed the tribunal’s findings other than unfair dismissal. Only the appeal in respect of the sex discrimination claim was remitted. The EAT judge said the tribunal had insufficiently explained its finding.

“The fundamental question for the employment tribunal was whether the non-payment of the claimant by the company was because of sex,” said the ruling. “It was not, of course, necessary for the non-payment to be wholly or mainly because of sex; it was sufficient if this was a significant reason for the treatment, either consciously or unconsciously – in other words, if the non-payment was tainted by the protected characteristic of sex.”

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