The Claimant resigned after working for 3 months for the Respondent citing bullying, constant criticism and excessive workload. The Respondent deducted 50% of the recruitment fee from her final wages. The Claimant brought a claim which referred to unlawful deductions amongst other payments due to her but did not explicitly claim that she had been constructively dismissed. The EJ concluded that the clause relied upon by the Respondent was not a penalty clause and decided that there had not been an unlawful deduction from the Claimant’s wages or an express breach of contract that would entitle the Claimant to recover the recruitment fee, together with any consequential loss. The EJ did not consider whether the Claimant was asserting that she had been dismissed constructively. The Claimant appealed.

The EAT allowed the appeal. The EJ should have appreciated that the Claimant was asserting that she had resigned as a result of the Respondent’s treatment of her, and that, as a result, they could not rely on a clause in her contract of employment to recoup recruitment fees. The EJ should have considered whether the Respondent had breached the implied term of mutual trust and confidence, whether the Claimant had resigned in response without having affirmed the contract, so that the clause permitting recoupment of fees could no longer be relied upon. The matter was remitted to the same ET to determine whether the Claimant was constructively dismissed. If she was, the Respondent accepted that the fees will have to be repaid.