Failure to Follow Grievance Process Can Amount to a Fundamental Breach of Contract

In Blackburn v Aldi Stores Ltd UKEAT/0185/12, the Employment Appeal Tribunal (EAT) held that an employer's failure to follow its own grievance appeal process could amount to a fundamental breach of contract, even where the underlying grievance procedure was non-contractual.

Mr Blackburn worked for Aldi Stores Ltd (Aldi).  He raised a grievance about various issues including health and safety, lack of training and mistreatment by a manager.  The grievance and his subsequent appeal were heard and dismissed by the same manager. This was not in accordance with Aldi's grievance procedure which, although non-contractual, stated that an appeal should be heard by a more senior manager.  Mr Blackburn resigned and brought a claim for constructive dismissal. Overturning the Tribunal's decision, the EAT held that Aldi's failure to follow its own grievance appeal procedure could amount to a fundamental breach of contract entitling Mr Blackburn to resign, even though the grievance procedure was non-contractual.  The EAT noted in particular that the right to an impartial appeal was an important feature of both the ACAS Code (the UK Government's guidance on grievance and disciplinary procedures) and Aldi's own grievance procedure, and failed to understand why an organization of Aldi's size had not been able to provide a different manager to hear the appeal. The case was remitted to the Tribunal to determine whether or not, on the facts, Aldi's failure to follow its appeal procedure had in fact amounted to a fundamental breach.

This is a reminder to employers to ensure they follow their own grievance procedures and the ACAS Code at all stages of a grievance process.  Failure to do so, even where the company grievance procedure is non-contractual, could expose the company to constructive dismissal claims.