The Claimant resigned in response to the Respondent unilaterally deciding to reduce his salary from £45,000 to £25,000 when the value of sales the Claimant was making fell. The ET recorded that "the Claimant's claim is understood" to be based on an allegation that, by that course of conduct, the Respondent without reasonable and proper cause had behaved in a manner calculated or likely to destroy or seriously damage the relationship of trust and confidence between it and the Claimant, i.e. that the ET understood the claim to be a claim of constructive unfair dismissal based on an alleged breach of the implied term. The ET held that the Claimant resigned because of the breach and that the breach was a breach of the implied term, but that the Respondent had reasonable and probable cause for imposing the pay cut. The Claimant appealed.

The EAT allowed the appeal. Given that the breach relied on was a significant breach of an important express term (as well as a pleaded breach of the implied term) the ET had erred in law in asking itself whether the employer had reasonable and probable cause for repudiating the contract of employment. It also held that the ET's conditional decision that any dismissal was unfair could not stand.