Asking employee to stop side hustle amounts to constructive dismissal

In the case of Lindsay v HBOS, a mortgage adviser had approved her cake-making business with her employer, which she ran as a hobby and said was therapeutic for managing her anxiety. She suffered from PTSD, severe anxiety and panic attacks, and was signed off work for a period. Her employer was aware that this side hustle was beneficial for her health and no concerns were raised.

However, whilst she was off sick, the employee faced continued stress because of regular check-up calls from her manager, who unreasonably questioned her medication and insisted she ask her doctor to review it. In one call, the manager told her to be mindful of the impact posting pictures of the cakes she baked on Facebook would have on her colleagues, especially since she was ‘supposed to be sick.’

At the time of the call, the manager knew the claimant was increasingly anxious about action being taken against her for her ongoing absence, and that she ‘catastrophised’ matters. There was also an arrangement that there would be no contact for at least one month, and an agreement that the manager would only call after receiving a text message to confirm this was appropriate.

As a result, the call caused significant distress and triggered the employee to have a panic attack which, ultimately, led to her resigning. She proceeded to claim constructive dismissal, saying her employer’s lack of support and unreasonable behaviour meant it was no longer tenable for her to continue to be employed by them.

The Employment Tribunal concluded that it was unreasonable for the manager to question her medical treatment, as there was no proper cause for doing so. It highlighted that this caused a serious breach of their duty of mutual trust and confidence. The ET also found that the call relating to her Facebook cake posts further damaged the employment relationship, especially since the employee was off sick with severe anxiety and the posting of her pictures was not a conduct issue, nor a matter that had to be discussed urgently.

The employer argued that the claim should not be successful since there was a delay between the incidents and her resignation: the call regarding her medication was on 30 November, and the Facebook post was discussed on 17 December, but the claimant did not resign until 19 January the next year. A delay in resigning can be seen as an acceptance of a breach, which can cause a claim to fail.

However, this line of defence was rejected by the ET who instead upheld her claim. The was decided based on a number of key facts: the case occurred over the festive period, and the manager was absent until 17 January; the claimant was in a high state of anxiety and wanted to discuss the issue with their trade union and consultant before acting, both of which took time; considering the claimant had 21 years’ service, it was deemed reasonable there was some delay in making her decision, and that her behaviour between the phone calls and her resignation did not indicate that she had accepted the breach.