Legislation
Case law: Failure to apologise for abuse costs firm dear
27/08/2010 09:43
Following a recent case, employers and firms are reminded to give agents and employees a reasonable opportunity to apologise for behaviour that might amount to a repudiatory breach (ie a reason so strong the other party can end an agreement) before terminating their agency or employment contract.
In this case, a supplier validly terminated employment of one of its agents after the agent abused its managing director and then failed to apologise. The agent failed to comply with changes requested by the firm in working practices that required them to use computers rather than paper – the only one out of ten agents who refused. The supplier fined the agent who then rang and abused the firm’s managing director twice, and left a rude voicemail.
The managing director gave the agent the opportunity to apologise, but no apology arrived. An apparent letter of apology was sent six days later, but this contained excuses for the abuse, rather than repentance. The agreement between firm and agent expressly required the agent to act in good faith and conscientiously, and stated that serious breach would lead to termination. The firm terminated the agent’s contract, and the agent sued.
The court said that abusive words spoken in the heat of the moment did not always amount to a repudiatory breach. If an apology was capable of remedying the situation, and a genuine apology was given, there would be no breach. However, in this case, the agent’s behaviour had been calculated, so amounted to gross insubordination, and would lead to an irrevocable breakdown in the trust required if their relationship was to work unless there was an adequate apology. The agent’s letter did not provide an adequate apology.
The same principles apply to abuse by an employer or employee.
Operative date
- Immediate